By Wellington Jopelo
Nigeria has lost a major chance to earn about N28.3 trillion yearly due to low oil production, even as global oil prices surged following the ongoing Iran war.
The Chairman of the Alliance for Economic Research and Ethics (AERE), Dele Oye, said the country failed to take advantage of the spike in crude oil prices, which crossed $100 per barrel.
According to him, while many oil-producing countries benefited from the price increase, Nigeria could not fully gain due to poor output levels.
Oye explained that although Brent crude currently sells between $102 and $114 per barrel, far above Nigeria’s budget benchmark of $64.85, the expected financial gain has not been realised.
He noted that Nigeria is currently producing about 1.46 million barrels per day, falling short of its 1.84 million barrels daily target, leaving a gap of about 380,000 barrels each day.
He added that a large portion of Nigeria’s crude oil is already committed to existing agreements, limiting how much the country can sell at current high prices.
Oye also recalled that during the Russia-Ukraine war, when oil prices rose significantly, Nigeria still failed to benefit due to similar production challenges and subsidy-related issues.
He stated that even efforts by the Nigerian National Petroleum Company Limited to increase output by 100,000 barrels per day are not enough to close the large production gap.
The economist said if Nigeria had improved production, the extra revenue could have been used to fund key sectors such as agriculture, energy, and social welfare programmes.
He listed possible uses of the funds to include fertilizer support for farmers, investment in refineries, social support for vulnerable citizens, and adoption of cleaner energy options like CNG and LPG.
Oye advised the government to focus on improving oil production, securing oil facilities, and reducing dependence on fuel subsidies to fully benefit from future price increases.
He also urged authorities to invest excess revenue into savings like the Sovereign Wealth Fund and support policies that will strengthen the economy in the long term.