Nigeria’s Crude Oil Sector Grows 16.4% Despite Falling Production — Signs of a Quiet Recovery Emerging
Nigeria’s crude petroleum sector has posted a surprising 16.37% year-on-year growth in the first quarter of 2026, signaling a rebound after months of contraction, according to fresh data from the National Bureau of Statistics (NBS). The performance marks a shift in momentum for one of the country’s most important revenue-generating industries, even as production levels continued to decline.
The NBS report shows that the crude oil and natural gas segment bounced back strongly from a 10.50% contraction in Q1 2025 and an even sharper 31.59% decline recorded in Q4 2025. This recovery also helped lift Nigeria’s broader mining and quarrying sector, which recorded a 13.92% growth rate after previously struggling with a 5.33% contraction.
Interestingly, this growth came despite a drop in average daily crude oil production, which fell to 1.55 million barrels per day in Q1 2026, down from 1.62 million barrels per day in the same period last year. However, higher output value—driven by stronger pricing and sectoral efficiency—pushed nominal production value to N4.27 trillion, up from N3.67 trillion in Q1 2025.
In real terms, the sector’s growth was more moderate, expanding by 2.57% year-on-year. While still positive, this marks a slowdown compared to the 6.79% recorded in Q4 2025, showing that momentum in actual physical output remains under pressure. The crude oil segment still dominated Nigeria’s extractive industry, contributing over 91% of total mining output during the period.
Despite the rebound, the oil sector’s overall contribution to Nigeria’s GDP remains relatively modest, accounting for just 3.86% in nominal terms. Analysts note that while crude oil is showing signs of recovery, Nigeria’s economic structure continues to rely heavily on the non-oil sector for growth, raising long-term questions about diversification and sustainability in the energy space.
source: nairametrics