Nigeria Oil Output Forecast at 1.7-1.8m bpd in 2026

Coronation Group’s latest outlook, which projects Nigeria’s crude oil production stabilising at 1.7 million to 1.8 million barrels per day (bpd) in 2026—well below the Federal Government’s ambitious 2.5 million bpd target set by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

Coronation Group, a leading Nigerian financial services firm offering investment management, wealth advisory, insurance, and capital market services, released its 2025 review and 2026 projections in its macroeconomic and sector reports. The analysis highlights that despite the oil and gas sector’s enduring role as an economic pillar, persistent challenges constrained performance in 2025.

In the first nine months of 2025, crude petroleum and natural gas contributed just 0.81% to nominal GDP, with sectoral output declining sharply by 20.13% year-on-year to N6.49 trillion. This drop stemmed primarily from softer global crude prices. Crude oil exports fell 11.30% to N24.92 trillion over the same period, influenced by lower prices and the nascent diversion of volumes to emerging domestic refineries such as Dangote.

Production showed intermittent monthly gains in April, June, July, and October 2025 but remained insufficient to recover earlier levels. Overall, output stayed below the 2025 budget benchmark of 2.06 million bpd and Nigeria’s OPEC quota of 1.5 million bpd. Recent data indicate average production hovered around 1.5–1.64 million bpd (including condensate) through late 2025, with December figures dipping to approximately 1.42 million bpd (crude only, per OPEC estimates).

For 2026, Coronation adopts a conservative stance, attributing the projected 1.7–1.8 million bpd range to limited incremental capacity additions, fiscal pressures, regulatory uncertainties, aging assets, funding constraints, and potential security or OPEC-related risks. While acknowledging meaningful contributions from private operators—such as Seplat Energy’s targeted ramp-up to 200,000 bpd over five years (from ~135,000 bpd in H1 2025) and Renaissance Africa’s plans to reach 300,000 bpd by early 2026 (from ~230,000 bpd in August 2025)—the firm concludes these will not suffice to close the gap to higher official targets, including NNPC’s medium-term aim of 2.0 million bpd by 2027.

Key 2025 developments include proposed amendments to the Petroleum Industry Act (PIA), intended to curb statutory leakages and enhance direct inflows to the Federation Account through ownership reallocation (e.g., vesting stakes in the Ministry of Finance Incorporated) and redefined NUPRC roles. Coronation cautions that these changes could concentrate powers, blur accountability, and introduce conflict-of-interest risks, particularly given perceived alignments between entities like the Ministry of Petroleum and NNPC.

Additionally, the new National Tax Act (NTA) imposes a 15% minimum effective tax rate across the value chain, phasing out certain incentives previously enjoyed by upstream operators (e.g., credits for greenfield gas projects like Seplat’s ANOH) and requiring monthly tax filings for midstream gas entities. This shift compels companies to reevaluate incentive benefits against rising tax burdens.

Despite softer 2025 oil prices, Coronation notes operational progress in upstream and midstream areas, driven by asset acquisitions, better evacuation, and gas infrastructure expansion. Looking forward, fiscal and regulatory evolution will increasingly determine sector trajectory.

As Nigeria navigates these dynamics in 2026, balancing realistic production growth with policy reforms will be essential to unlocking sustained revenue, attracting investment, and supporting broader economic objectives amid global energy transitions.