Nigeria’s economic outlook is showing signs of continued improvement, with higher oil production, ongoing government reforms and stronger private-sector activity helping to sustain growth, according to the Organisation of the Petroleum Exporting Countries (OPEC). The oil-producing organisation said Nigeria’s economy expanded by 3.9 per cent year-on-year in the first quarter of 2026, only slightly below the 4.0 per cent recorded in the final quarter of 2025.
OPEC said the non-oil sector remains a major engine of Nigeria’s economic growth, with agriculture, manufacturing, construction, trade, finance and insurance contributing significantly to economic activity. At the same time, increased oil output has helped improve government revenues, foreign exchange inflows and the country’s external buffers, giving the economy additional support as reforms continue.
Private-sector activity has also remained in expansion territory, although growth moderated slightly in July. OPEC noted that the Stanbic IBTC Bank Nigeria Purchasing Managers’ Index fell to 52.5 in July, from 53.4 in June and 54.1 in May. Despite the decline, the reading marked the sixth consecutive month of improvement, with businesses reporting stronger new orders, improved customer demand and modest increases in output and employment.
The organisation also highlighted the growing role of domestic refining capacity, particularly the Dangote Petroleum Refinery, in improving fuel availability and reducing some of Nigeria’s dependence on imported petroleum products. With the refinery’s 650,000-barrel-per-day nameplate capacity and expanding operations, increased local fuel supply could help ease some import-related pressures and provide more stability for businesses and consumers.
OPEC maintained that Nigeria’s near-term economic outlook remains positive, supported by rising oil production, reform efforts, infrastructure investment and stronger business activity. While inflation and higher fuel and raw material costs remain challenges, the organisation said some cost pressures were beginning to soften. For Nigeria, the combination of oil-sector gains and broader economic activity suggests that the reforms and investments underway could continue to shape the country’s growth story in the months ahead.
source: punch
