Nigeria has encountered a substantial revenue loss of over N8.7 trillion ($21 billion) from January to August 2023 due to its inability to meet its allocated quota by the Organization of Petroleum Exporting Countries (OPEC). This unfortunate situation has transpired at a time when Nigeria is grappling with a worsening debt crisis.
As Africa's largest crude oil producer, Nigeria has struggled to fulfill its OPEC quota, failing to extract 144 million barrels of crude oil within the aforementioned period. Although OPEC allocated a daily quota of 1.8 million barrels to Nigeria, the country could only manage to produce 288 million barrels during those eight months.
The fluctuation in oil prices further complicated the situation. While oil prices reached $82 per barrel in January, they later dropped to $70 in March and currently stand at $92 per barrel. These fluctuations necessitated an average price calculation of $80 per barrel.
The inability to meet production quotas has been attributed to factors such as oil theft and pipeline vandalism in the Niger Delta. Despite efforts to curb these issues, Nigeria has struggled to restore its production levels.
This revenue loss poses a significant challenge to Nigeria's economic stability, fiscal planning, and budget execution. Experts are urging the Nigerian government to address the issue of oil theft to bolster revenue and mitigate further losses.
