Nigeria's Oil Production Climbs to Six-Year High

Nigeria increased crude oil production to its highest level in more than six years during June, giving Africa’s largest oil producer an opportunity to strengthen exports as renewed tensions in the Middle East reshape global energy markets. According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), crude oil production averaged 1.56 million barrels per day in June, the country’s highest monthly output since April 2020. The figure exceeded Nigeria’s OPEC+ production target of 1.5 million barrels per day.

Including condensates, total production reached 1.735 million barrels per day, marking a fourth consecutive monthly increase. Production has risen by around 17% since February, while exports from the Bonny crude stream also increased during the month.

Output Recovery Continues

Nigeria’s production recovery follows several years of lower output caused by crude theft, pipeline vandalism and operational disruptions that pushed production below one million barrels per day.

The NUPRC attributed June’s performance to more stable operations across producing assets and the absence of major pipeline outages. According to the regulator, peak production reached 1.89 million barrels per day on one day during the month, demonstrating the country’s ability to move closer to its longer-term production targets.

Higher production also arrives at a time when international oil prices remain elevated. Brent crude traded above US$85 per barrel following renewed uncertainty around shipping through the Strait of Hormuz, increasing demand for crude supplies that do not rely on the Gulf export route.

Export Markets

Nigeria’s Atlantic location provides an advantage during periods of disruption in the Middle East. Crude grades such as Bonny Light, Qua Iboe and Forcados are widely used by refiners because of their relatively low sulphur content and can reach European markets without passing through the Strait of Hormuz. The current market conditions could help Nigeria regain export market share while improving foreign exchange earnings. However, the opportunity may prove temporary if shipping conditions in the Gulf return to normal or global oil demand weakens.

Growing Demand

At the same time, Nigeria’s expanding refining capacity is creating greater domestic demand for crude oil. The Dangote Refinery, Africa’s largest refinery, has a processing capacity of 650,000 barrels per day. As local refining continues to expand, policymakers will need to balance crude exports that generate foreign currency with domestic supply requirements that support fuel production within Nigeria.

The country’s upstream sector is also attracting renewed investment following the transfer of several onshore assets from international oil companies to indigenous operators. Sustaining higher production levels will depend on continued investment, improved pipeline security and reliable infrastructure.

While June’s production figures represent an important milestone, maintaining output above 1.5 million barrels per day over the coming months will provide a clearer indication of whether Nigeria’s recovery is becoming sustainable or simply reflects favourable market conditions.