Nigeria realised over $30bn from the sale of crude oil during the first 11 months of 2021

NIGERIA produced a total of 440.774m barrels of crude oil during the first 11 months of 2021 with a combined value of N12.4trn ($30.03bn) despite the slowdown in the global economy precipitated by the coronavirus pandemic.

Over the last two years, Nigeria has felt the full brunt of the Covid-19 pandemic as crude oil sales have dropped and foreign direct investment has dried up. Despite this, between January and November 2021 the government still managed to raise a decent sum from crude oil receipts according to the latest oil production data released by the federal government.

A document on Crude Oil and Condensate Production for 2021, obtained from the Nigerian Upstream Petroleum Regulatory Commission, indicated that the federal government raked in about N12.4tn from crude oil alone sales during the review period. Oil production during the 11-month period kept fluctuating, hitting a high of 44.287m barrels in March, while the least production volume of 37.405m barrels was recorded in September.

Production volumes in the months of January, February, April, May and June were 42.195m, 39.869m, 41.17m, 41.679m and 39.4m barrels respectively. For the months of July, August, October and November, the country’s crude oil production volumes were 41.026m, 38.406m, 38.06m and 38.247m barrels respectively.

Data from Statistica, a global statistical firm, showed that on the average, monthly prices of a barrel of Brent, the crude against which Nigeria’s oil is priced, in January, February, March and April 2021 were $54.77, $62.28, $65.41 and $64.81 respectively. In May, June, July and August 2021, the average prices were $68.53, $73.16, $75.17 and $70.71 per barrel respectively.

For the months of September, October and November, the average monthly prices of Brent per barrel were put at $74.49, $83.54 and $81.54 respectively. Nigeria's official exchange rate during the period was around N400 to the dollar and this rate stayed above N400 from May to November 2021, after hovering around N379 to the dollar in the earlier months.

Experts at the Centre for the Promotion of Private Enterprises, headed by renowned economist, Dr Muda Yusuf, in their 2022 Economic Outlook for Nigeria, stated that a sustained recovery of global oil prices was envisaged this year. They pointed out that Nigeria would require crude oil to run its economic activities.

Dr Yusuf added: “We expect that the average oil price in 2022 will exceed the budgeted benchmark of $62 per barrel, offering some fiscal headroom. This would be powered by higher energy demand driven by the recovery of economic activities globally.

“This trajectory is expected to impact on our foreign reserves and strengthen the capacity of the Central Bank of Nigeria to support the foreign exchange market.” Also, the Organisation of Petroleum Exporting Countries projected a slow momentum in terms of economic recovery this year, adding that oil would be vital in this growth.