Nigeria’s oil revenue drops 21% below target in Q4 2024 – Budget Office

By Kunle Sanni –

Nigeria’s oil earnings fell short of expectations in the last quarter of 2024, with the federal government recording a net oil revenue of ₦3.34 trillion, about 21 percent below the quarterly budget estimate of ₦4.24 trillion, according to the latest report from the Budget Office of the Federation.

In its Q4 2024 Budget Implementation Report, the office said the country’s oil inflows were also lower than the ₦3.99 trillion recorded in the third quarter, representing a 16 percent decline, though significantly higher than the ₦2.41 trillion earned in the same period in 2023.

The report attributed the underperformance to declining oil production and lifting, persistent crude oil theft, low investment in the sector, and high fiscal deductions, including those related to the federal government’s petroleum subsidy policy.

Gross oil revenue for the quarter stood at ₦3.9 trillion, reflecting a ₦1.09 trillion shortfall (21.8 percent) against the prorated budget estimate. The figure was ₦714.6 billion (15.5 percent) lower than the third quarter’s ₦4.62 trillion but more than doubled the ₦1.89 trillion recorded in Q4 2023.

Despite the overall shortfall, some revenue components outperformed expectations. Royalties from oil and gas brought in ₦2.18 trillion, exceeding projections by 36 percent, while concessional rentals and miscellaneous income (such as pipeline fees) surpassed estimates by 156 percent and 118 percent, respectively.

In contrast, crude oil and gas sales, petroleum profit and gas taxes, and incidental oil revenue fell significantly below projections. Petroleum profit and gas taxes, in particular, underperformed by ₦1.74 trillion, or 58 percent.

Additional gains were recorded from gas flared penalties and foreign exchange earnings, generating ₦108.5 billion and ₦1.22 trillion, respectively, despite having no prior projections in the budget.

For the entire 2024 fiscal year, total gross oil revenue amounted to ₦15.07 trillion, falling short of the ₦19.99 trillion budgeted—a ₦4.93 trillion (24.7 percent) deficit. However, the 2024 figure represented a notable improvement over the ₦8.36 trillion collected in 2023, marking an 80 percent year-on-year increase.