Nigeria’s crude oil exports to the United States during the first seven months of 2025 generated $2.21 billion, maintaining its position as the largest African crude supplier to the US market. This revenue was derived from the export of 28.7 million barrels of crude oil, with a customs value of $2.16 billion and a cost, insurance, and freight (CIF) value of $2.21 billion, reflecting the added costs of transatlantic shipping. Despite retaining its leading supplier status among African nations, Nigeria experienced a decline in both export volume and revenue compared to the same period in 2024. This decline represents an 8.8% drop in volume and a substantial 22% decrease in value, highlighting the impact of both lower shipment volumes and weaker average crude oil prices.
This decrease in export earnings is mirrored in Nigeria’s overall crude oil export performance for the first half of 2025. Despite increased production volumes, the nation witnessed a significant N3.18 trillion decline in crude oil export earnings compared to the same period in 2024. This drop, documented by the National Bureau of Statistics (NBS), reveals a concerning trend, with the most substantial decline occurring in the first quarter of 2025, experiencing a 16.3% fall. The second quarter saw a less dramatic but still significant 5.1% decline. This downward trajectory emphasizes the challenges facing Nigeria’s oil sector, particularly its vulnerability to fluctuating global oil prices and market dynamics.
The NBS data further reveals a diminishing reliance on crude oil exports as a percentage of Nigeria’s total exports. While crude oil constituted 80.8% of total exports in the first quarter of 2024, this figure decreased to 62.9% in the corresponding quarter of 2025. This trend continued in the second quarter, with crude oil’s contribution falling from 71.2% in 2024 to 52.6% in 2025. While this shift may suggest a potential diversification of the Nigerian economy, experts caution that it may primarily reflect the shrinking value of crude oil exports rather than substantial growth in other sectors. This raises concerns about the country’s overall economic resilience.
Several factors contribute to Nigeria’s weakening oil export performance. Global oil price volatility, increased competition from other crude oil suppliers, and ongoing logistical challenges within Nigeria, including theft and vandalism targeting oil infrastructure, all play a role. These issues hinder the country’s ability to maximize production and export potential, even when production volumes rise. Additionally, evolving energy demands in the US, particularly the growth of domestic shale oil production, have reduced its reliance on foreign crude, thus impacting Nigerian exports. Despite these hurdles, industry stakeholders acknowledge the positive impact of government efforts to curb oil theft, which has contributed to increased production volumes.
Nigeria’s heavy reliance on crude oil exports for foreign exchange and government revenue exposes the country to significant fiscal risks. The decline in export earnings threatens to further weaken the Nigerian Naira and strain the nation’s capacity to finance imports and manage debt obligations. This underscores the urgent need for economic diversification, reducing dependence on the volatile oil market. Although non-oil export sectors have shown some growth, they remain insufficient to offset the impact of declining crude oil revenue. This calls for a strategic and sustained effort to strengthen and expand other sectors of the economy.
The future of Nigeria’s crude oil export performance hinges on a complex interplay of factors, including global oil prices, domestic production stability, and US energy demand. A recovery in oil prices coupled with sustained production levels could potentially bolster earnings in the latter part of the year. While Nigeria currently maintains its status as America’s leading African crude oil supplier, the challenges faced by its oil sector underscore the need for proactive measures to mitigate risks and ensure long-term economic stability. The focus must shift towards fostering a more diversified and resilient economy, less vulnerable to fluctuations in the global oil market.
