Nigeria’s crude oil production is projected to rise to 1.72 million barrels per day (bpd) in the fourth quarter of 2026, although contractual obligations and production costs could limit the benefits for government revenue and domestic refineries.
The projection attributed to Dangote Group puts Nigeria’s average crude oil output at 1.62 million bpd for the full year, reflecting a gradual recovery in production through the second half of 2026.
Under the forecast, output is expected to increase from about 1.55 million bpd in the second quarter to 1.70 million bpd in the third quarter before reaching 1.72 million bpd in the final three months of the year.
The outlook follows a period of improved production. Reuters reported on July 13, 2026, that Nigeria’s crude oil output averaged 1.56 million bpd in June, its highest level since April 2020, according to the Nigeria Upstream Regulatory Commission.
Dangote Group also projects Brent crude prices to average about $90 per barrel in 2026 before easing to around $85 per barrel in the fourth quarter, assuming geopolitical tensions moderate.
However, higher production may not automatically translate into a larger supply of crude for the Federal Government or local refiners.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said on October 9, 2026, that Nigeria did not have enough freely available crude oil to meet the Dangote Refinery’s full requirements.
Speaking on Channels Television’s Politics Today, Oyedele explained that although Nigeria produces about 1.8 million barrels daily, the volume is shared among parties operating under production-sharing contracts and joint-venture arrangements.
Production costs, royalties and other contractual obligations further reduce the quantity available to the government.
Oyedele said Nigeria currently had less than 700,000 barrels of uncommitted crude available for allocation to buyers, including the Dangote Refinery, which has a stated processing capacity of 700,000 bpd.
The minister’s comments highlight the gap between national production figures and the volume available for domestic refining after contractual commitments and deductions.
For Nigeria, sustaining higher crude production could improve export earnings and expand the supply available to local refiners. However, the extent of those benefits will depend on production growth, contractual arrangements and the amount of crude the government can make available.
