Business Hilights

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Oil sector improves but remains in the negative territory

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The oil sector improved in Q3-23 as the government’s unrelenting efforts to curb oil theft and vandalism have enhanced crude oil production levels. For context, crude oil production increased by 20.8% y/y to 1.45mb/d (Q2-23: 1.22mb/d). Further in our analysis, data from the NUPRC showed that crude oil production increased significantly across the Bonny (+405.0% y/y), Brass (+179.3% y/y), Forcados (+212.4% y/y), Bonga (+25.0% y/y), Escravos (+19.9% y/y), and Odudu (+16.3% y/y) production terminals in Q3-23. Notwithstanding, crude oil production remains below pre-pandemic levels, signaling the lingering challenges of (1) crude oil theft and pipeline vandalism, (2) shutdown of flow stations for pipeline leakage repairs, terminal maintenance, and flare management, and (3) inadequate contributions from licensed Oil Marginal Fields (OMF). Overall, while the sector growth is still negative, we highlight that it contracted to its softest decline in fourteen quarters (Q3-23: -0.85% y/y | Q2-23: -13.43% y/y).

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