Nigeria experienced a 35 percent decline in oil imports during the second quarter of 2024, totaling $2.79 billion, a decrease from $4.31 billion in the preceding quarter.
This information is derived from the Central Bank of Nigeria's quarterly economic report for the second quarter of 2024.
The decrease underscores the evolving landscape of the country's oil and gas industry, which is undergoing significant structural and economic changes following the elimination of fuel subsidies by the Bola Tinubu administration.
Additionally, the report indicated a broader contraction in merchandise imports, which fell by 20.59 percent to $8.64 billion, down from $10.88 billion in the first quarter of 2024. The notable drop in oil imports played a crucial role in this overall decline.
The report read, “Merchandise import decreased in Q22024, following the decline in the import of petroleum products. Merchandise imports decreased by 20.59 per cent to $8.64bn, from $10.88bn in Q12024.
“Analysis by composition indicated that oil imports decreased to $2.79bn, from $4.31bn in the preceding quarter.
“Non-oil imports also declined to $5.85bn, from $6.57bn in the previous quarter. A breakdown of total import showed that non-oil imports accounted for 67.72 per cent, while oil imports constituted the balance.”
The report also highlighted the challenges facing domestic production, which decreased by 4.51 percent to 1.27 million barrels per day.
Ongoing issues, including oil theft and vandalism in the Niger Delta, continue to pose significant obstacles to maintaining production stability.
The report read, “Domestic crude oil production declined in Q22024, attributed to persistent oil theft and illegal refining activities in the NigerDelta region. Nigeria’s average crude oil production fell by 4.51 per cent to 1.27 mbpd in Q22024, from 1.33 mbpd in the preceding quarter.
“This was due to crude oil theft and pipeline vandalism in the Niger Delta region, leading to a decline in production from the Forcados, Bonny, Qua-Iboe, Escravos and Brass streams, respectively. Nigeria’s crude oil production level fell short of its OPEC quota of 1.58 mbpd by 308,000 bpd in Q22024.”
In spite of these challenges, there was a modest improvement in global crude oil prices.
Nigeria's benchmark crude, Bonny Light, experienced an increase, reaching $86.97 per barrel in the second quarter of 2024, which provided some support to export revenues.
During this quarter, crude oil and gas exports represented 87.38 percent of total export earnings, although total receipts slightly decreased to $12.18 billion from $12.42 billion in the first quarter.
Additionally, it was previously reported that the Central Bank of Nigeria allocated $2.97 billion to stakeholders in the oil sector for the importation of petroleum products and related goods into the country.