Crude Oil Sales Increases By 46% To N21tn – NBS

OPEC+ Maintains Monthly Crude Oil Output Increase At 400,000bpd

Nigeria’s overall exports would reach N26.79 trillion in 2022 thanks to a 46.41 percent increase in crude oil sales.The entire amount of commerce increased by 31.79 percent, from N39.75 trillion in 2021 to N52.39 trillion in 2022. Sales of crude oil reached N21.09 trillion in 2022, a 46.41 percent rise from N14.41 trillion in 2021. Crude oil constituted 78.74% of all exports in 2022.

The National Bureau of Statistics reports that overall exports for 2022 increased by 41.72 percent, from N18.91 trillion in 2021 to N26.79 trillion in 2022. In 2022, imports increased by 22.77% from N20.84 trillion in 2021 to N25.59 trillion.

In 2022, Nigeria spent N2.63tn importing food and live animal; N10.12tn importing petroleum and other mineral fuel; N1.93tn on manufactured goods; and N5.93tn on machinery and transport equipment.

Commenting on the growth of foreign trade, the NBS said, “In the fourth quarter of 2022, Nigeria’s total trade stood at N11.72tn of which total exports stood at N6.36tn and total imports amounted to N5.36tn.

“On an annual basis, total trade was N52.39tn, total imports amounted to N25.59tn, and total exports were recorded at N26.79tn.”

Explaining the breakdown for Q4, 2022, the national statistics body stated, “The top five export destinations in the fourth quarter of 2022 were Spain, Netherlands, India, France, and Indonesia accounting for 9.70 per cent, 9.03 per cent, 7.71 per cent, 7.70 per cent and 7.44 per cent respectively of total exports.

“Altogether, exports to the top five countries amounted to 41.59 per cent of the total value of exports.”

It added, “In terms of Imports, in the fourth quarter of 2022, China, Belgium, India, The Netherlands, and the United States of America were the top five countries of origin of imports to Nigeria.

“The values of imports from the top five countries amounted to N2.99tn representing a share of 55.82 per cent of the total value of imports. The commodities with the largest values of imported products were ‘Motor Spirit Ordinary’ (N1.56tn), ‘Gas Oil’ (N220.47bn), and ‘Durum Wheat (Not in seeds)’ (N187.96bn)”

Despite a rise in crude oil sales, the World Bank had said that Nigeria had not benefited from the increase in oil prices due to fuel subsidies and lower oil output.

The global bank estimates that between 2020 and 2022, the average price of crude oil grew by approximately 150%, while Nigeria’s macroeconomic performance deteriorated and its fiscal space shrunk over this period. It said that the government’s expected budget deficit rose from 5.4 percent of GDP in 2020 before to the boom to 5.7 percent of GDP in 2022.

The Washington-based bank said that high production costs, theft and insecurity, joint-venture cash-call arrears, and inadequate investment have caused Nigeria’s crude oil output to fall consistently below its Organisation of the Petroleum Exporting Countries quota since June 2020.

Commenting on fuel subsidy, the bank explained, “Second, the ballooning cost of the petrol subsidy: The continuation of the petrol subsidy (deducted directly from oil revenues) implies forgone fiscal revenues of 2.5–2.7 per cent of GDP in 2022.

“This, combined with the protracted decline in oil production, has resulted in the lowest levels of net oil revenues (in percent of GDP) being transferred to the government in over a decade.”

In its recent article IV report on Nigeria, the International Monetary Fund stated, “Higher oil prices are yet to deliver tangible benefits amid contraction of oil production and costly fuel subsidies.”

According to the IMF, Nigeria has missed its opportunity to benefit from higher global oil prices. From January to July 2022, Nigeria’s oil production slumped by 28 million barrels threatening the Federal Government’s N9.37tn oil and gas revenue target for 2022.

From January and April, the government projected that it would earn N3.12tn, but only generated only N1.23tn in the period.

A former President, Association of National Accountants of Nigeria, Dr Sam Nzekwe, had stated that the continued reduction in oil production and the country’s inability to meet its revenue target might lead to bankruptcy.

He said, “The massive oil theft in the Niger Delta, which is on an industrial scale, has continued to stop Nigeria from meeting its OPEC production quota. The impact of this is very clear. The finance minister told you that the government was finding it difficult to meet its obligations because of a lack of funds.”