Nigeria experienced a notable 35% reduction in oil imports during the second quarter of 2024, with figures dropping to $2.79 billion from $4.31 billion in the first quarter. This decrease, reported by the Central Bank of Nigeria (CBN), is attributed to structural adjustments following the removal of fuel subsidies under President Bola Tinubu’s administration, reflecting significant shifts in the nation’s oil sector.
The CBN’s quarterly economic report also revealed a 20.59% decrease in total merchandise imports, which fell to $8.64 billion from $10.88 billion in Q1. The decline in oil imports was a major factor contributing to this overall contraction.
“Merchandise import decreased in Q2 2024, following the decline in the import of petroleum products. Merchandise imports decreased by 20.59 percent to $8.64 billion, from $10.88 billion in Q1 2024. Analysis by composition indicated that oil imports decreased to $2.79 billion, from $4.31 billion in the preceding quarter,” the report stated. Non-oil imports also declined, amounting to $5.85 billion of the total.
The CBN report further highlighted a 4.51% decline in Nigeria’s domestic oil production, which dropped to 1.27 million barrels per day (mbpd). This underperformance is attributed to ongoing issues such as oil theft and illegal refining in the Niger Delta, resulting in a production rate below Nigeria’s OPEC quota of 1.58 mbpd. Disruptions in the Forcados, Bonny, Qua-Iboe, Escravos, and Brass streams contributed to this shortfall.
Despite these challenges, rising global oil prices provided some relief, with Bonny Light crude increasing to $86.97 per barrel, partially cushioning export revenues. Crude oil and gas exports, although slightly reduced, constituted 87.38% of Nigeria’s total export earnings, generating $12.18 billion in Q2 2024, compared to $12.42 billion in Q1.
Earlier, the Central Bank allocated $2.97 billion to oil sector participants to support the importation of petroleum products, aiming to stabilize supply amidst the country’s evolving economic landscape.
