Oil & Energy
Oil Sector Slowdown’ll Threaten 2025 Budget Execution – NESG
The Nigerian Economic Summit Group (NESG) has raised concerns over the persistent underperformance of the oil and gas sector, warning that it poses a significant threat to the effective implementation of the 2025 budget.
In its latest publication titled “NESG 2025Q1 GDP Alert”, the private sector-led think tank observed that Nigeria’s crude oil production in the first quarter of 2025 fell well below the government’s budget benchmark of 2.06 million barrels per day (mbpd).
This shortfall, the NESG warned, translates directly into lost oil revenues, which are critical to funding key government expenditures outlined in the budget.
“Persistent slowdown in the oil and gas sector poses a threat to the execution of the 2025 budget.
“In 2025Q1, the average crude oil production is significantly below the budget benchmark of 2.06mbpd, translating to lost oil revenues needed to implement the budget.
“This suggests the urgent need to resolve challenges facing domestic crude oil production, including ageing infrastructure, oil theft, pipeline vandalism, and kidnapping of expatriate workers”, the report stated.
The group commended the improvements in the refining sector’s performance in recent months.
“Persistent improvement in the Oil refining sector is remarkable”, NESG stated.
It, however, noted that there is a need to revive state-owned refineries to sustain the sector’s growth.
“The emergence of Dangote Refinery has been a game-changer for Nigeria’s oil and gas sector, reversing more than half a decade of contraction in the Oil refining sector and slashing import bills on petrol by about 53 percent (year-on-year) in 2025Q1.
“This suggests the need to support privately owned refineries and incentivise investments into the downstream oil and gas sector”, NESG noted.