Nigeria’s oil industry is facing a difficult start to the year as fresh data reveals a notable dip in production. According to the latest figures from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the country’s total oil output which includes condensates fell by 8.3 percent in December 2025 compared to the same period in 2024. Production levels dropped to 1.544 million barrels per day (bpd), down from the 1.684 million bpd recorded a year earlier.
This downward trend was also visible on a monthly basis. Reports observed that output slipped from 1.599 million bpd in November 2025 to the current 1.544 million bpd in December. While the regulator did not explicitly state the cause of the decline in its report, industry insiders suggest that a lack of fresh investment and ongoing production challenges are likely the main culprits.
The figures also highlight a widening gap between Nigeria’s actual performance and its official targets. Out of the total 1.544 million bpd produced, only about 1.422 million bpd was actual crude oil, with the remainder being condensates. Because the Organization of Petroleum Exporting Countries (OPEC) does not count condensates toward production limits, Nigeria fell short of its 1.5 million bpd OPEC quota. Perhaps more concerning for the national treasury is the distance from the 2025 budget target, which was set at a much more ambitious 2.06 million bpd.
Confirming these findings, OPEC’s January 2026 Monthly Oil Market Report noted a marginal 0.9 percent month-on-month decrease in crude production based on direct communications with Nigerian authorities. These numbers reflect the reality of a sector struggling to reach its full potential despite a budget predicated on a stable exchange rate and a $75 per barrel price point.
Offering a deeper perspective on these challenges, Professor Emeritus Wumi Iledare, a veteran of petroleum economics, shared his thoughts with Reports. He pointed out that the reasons for the decline are unfortunately all too familiar. He cited a combination of insecurity, a lack of new oil block discoveries, and persistent policy uncertainty as the primary factors scaring off investors.
Professor Iledare further argued that Nigeria is suffering from governance gaps and a lack of clear leadership within the sector. He emphasized that the selective implementation of the Petroleum Industry Act (PIA) must end if the country hopes to regain its footing. According to him, until the government provides a more predictable environment and addresses the “proxy drivers” currently steering the industry, meeting production quotas will remain an uphill battle.
