Nigeria’s oil revenue dropped by 22% to N3.9 trillion in the fourth quarter of 2024, reflecting a significant shortfall against budgetary expectations.
This is according to the Budget Office of the Federation (BOF)’s Q4 2024 Budget Implementation Report.
The Budget Office disclosed that the country recorded N3,908.50 billion in gross oil revenue, representing a N1,090.58 billion (21.82%) decline compared to the prorated quarterly budget estimate.
The performance also fell short of the N4,623.12 billion generated in the third quarter of 2024 by N714.61 billion (15.46%), though it showed a marked improvement of N2,022.39 billion (107.23%) over the N1,886.11 billion earned in the corresponding period of 2023.
Breakdown of oil revenue components
The report provided a detailed breakdown of oil revenue performance across various components for the period under review.
According to the Budget Office, Royalties (Oil & Gas) generated N2,184.64 billion, exceeding the quarterly estimate of N1,605.90 billion by N578.73 billion (36.04%).
The report noted that Concessional Rentals amounted to N5.59 billion, surpassing the target of N2.18 billion by N3.41 billion (156.15%).
Miscellaneous Revenue — including pipeline fees and other charges — totalled N8.79 billion, exceeding the projection of N4.02 billion by N4.77 billion (118.48%).
“Gas Flared Penalty and Exchange Gain, which had zero projection, yielded N108.54 billion and N1,221.49 billion in the quarter under review,” the report stated.
However, some key components underperformed.
“Crude Oil and Gas Sales of N335.69 billion, Petroleum Profit and Gas Taxes of N1,249.68 billion and Incidental Oil Revenue (Royalty Recovery & Marginal Field) of N15.57 billion however fell below their quarterly estimates of N366.09 billion, N2,994.62 billion and N26.25 billion by N30.40 billion (8.30 percent), N1,744.95 billion (58.27 percent) and N10.69 billion (40.70 percent), respectively,” Budget Office said.
What this means
The decline in oil revenue raises fresh concerns over Nigeria’s fiscal stability, particularly as the federal government continues to depend heavily on oil proceeds to fund key budgetary commitments.
- Despite the setback, the federal government remains optimistic that recent reforms in the petroleum sector — including the implementation of the Petroleum Industry Act (PIA), renewed security measures in the Niger Delta, and improved oversight of oil production — could help stabilise revenues in subsequent quarters.
- Nairametrics reports that Nigeria’s non-oil revenue surged to N4.387.93 trillion in the fourth quarter of 2024, representing an increase of N1.68 trillion (62.39%) above the quarterly estimate of N2.70 trillion.
- This result was driven by strong receipts from Company Income Tax (CIT) of N1.5 trillion, Value Added Tax (VAT) of N194 trillion and Customs collections of N837.38 billion, which all exceeded their targets by 79.79%, 96.94% and 16.75% respectively.
