Nigeria is failing to capitalise on the surge in global crude oil prices triggered by the ongoing Middle East crisis because the country’s crude production remains far below its installed capacity, a renowned economist has said. Dr Chijioke Ekechukwu, Group Managing Director of Bristol Investment Limited, stated that Nigeria would have recorded a major economic windfall if output had reached its full potential or met its Organisation of Petroleum Exporting Countries quota.
According to OPEC data, Nigeria’s crude oil production fell to 1.31 million barrels per day in February, significantly below its allocated quota of 1.5 million barrels per day. This shortfall comes as global crude prices have risen sharply following tensions involving the United States and Iran, with prices now far above Nigeria’s 2026 budget benchmark of $64.9 per barrel.
Ekechukwu noted that the combination of higher prices and optimal production could have eliminated the country’s fiscal deficit for the year. “Nigeria is currently producing far below its potential as an oil-producing nation, thereby limiting the benefits it can derive from the current rise in global crude prices,” he said in an interview with the News Agency of Nigeria.
While the government may still see some revenue boost from higher prices, the economist warned that the gains are substantially lower than what could have been achieved with full production capacity. The shortfall reflects persistent challenges including pipeline vandalism, crude theft, infrastructure constraints, and maintenance issues at key oil fields.
However, Ekechukwu cautioned that any revenue gains at the federal level are coming at the expense of ordinary Nigerians, who are bearing the burden of rising petroleum product costs. The surge in fuel prices has triggered increases in diesel costs, transportation fares, and production expenses across multiple sectors.
“The rising energy costs are already pushing up prices of goods and services, thereby worsening the cost of living pressures on citizens,” he explained. “Nigerians are already experiencing high fuel costs, high diesel prices, rising transportation costs and increased production expenses. These increases are translating into higher prices of goods and services, meaning the purchasing power of the average Nigerian is declining rapidly.”
The economist’s assessment highlights the dual challenge facing Nigeria’s economy: the inability to fully benefit from favourable global oil market conditions due to production constraints, while citizens simultaneously suffer from the inflationary effects of those same higher prices through increased fuel and transportation costs.
