Not Even a High Oil Price Can Rescue Nigeria’s Oil Revenue as It Drops to a 4-Month Low

Not Even a High Oil Price Can Rescue Nigeria’s Oil Revenue as It Drops to a 4-Month Low

  • Despite higher oil prices than projected in the 2022 budget, Nigeria's economy continues to suffer.
  • Despite the rise in tax payments and collections from FIRS, customs, and other sources, Nigeria still relies largely on oil money.
  • Oil prices have risen in recent months, but Nigeria is missing out on revenue that may rescue the economy

The Central Bank of Nigeria (CBN) has revealed that federal government earnings from oil sales dropped to a four-month low.

CBN stated this in its latest monthly economic report for January 2022 published on its website.

According to the CBN data, in January Nigeria made N945 billion, this is 7.8 per cent less than the N1.024 trillion budgeted for the period.

Not Even high Oil price Can Rescue Nigeria’s oil revenue as it drops to a 4-month low
Breakdown of revenue Credit: CBN
Source: Facebook

Breakdown of the revenue

A breakdown of the components of oil revenue showed that no revenue accrued from crude oil and gas exports in January, the second straight month the government has earned nothing from such a major income source.

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No money was recorded for oil and gas exports because the Nigerian National Petroleum Company has not remitted funds to the joint pool of the federation account in recent months, due to rising petrol subsidy claims, on the back of elevated crude oil prices as well as lower oil production.

Revenue from petroleum profit tax and royalties, which formed the bulk of oil revenue, declined by 31 per cent to N247 billion compared with N360 billion the previous month and was also below the monthly target of N277 billion.

Oil prices

Meanwhile, according to data from oil prices, Nigerian oil blends on Monday, 6 June sells at a record high.

At $124.18, Bonny light, produced in Oloibiri in the Niger Delta, is currently the most expensive OPEC blend.

Brass River Crude Oil, a sweet medium-light Nigerian crude, is selling for $126.60, the same price as Qua Iboe crude oil, which is also a Nigerian mix.

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NNPC sets date for completion of PH refinery

In other news, the Nigeria National Petroleum Company (NNPC) has revealed the date for the completion of the Port Harcourt refinery.

In 2021, NNPC during the award of the repair works contract to an Italian firm, Tecnimont promised 18 months of completion.

The repair works are expected to gulp over N539 billion($1.5 billion) NNPC believes it will be ready for use in a few months' time.


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