Nigeria Excluded from Increasing Production Quota as OPEC Adds 548,000 Barrels
Nigeria’s economic hopes suffered a major blow over the weekend as the Organization of the Petroleum Exporting Countries and its allies (OPEC+) agreed to a significant crude oil production increase of 548,000 barrels per day (bpd), excluding Nigeria from the boost due to its persistent underproduction challenges.
The decision, reached during an OPEC+ meeting on Friday, July 5, will allow eight member countries—including Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman—to raise their production quotas starting in August.
The goal is to recapture global market share and meet rising demand, particularly from Asia.
However, Nigeria, once a major player in the oil market, was left out of the production hike after failing to meet its previous output targets, making it ineligible for the latest adjustments.
Nigeria has struggled for years to hit its OPEC+ production quota, falling short due to rampant oil theft, pipeline vandalism, underinvestment in infrastructure, and ongoing operational inefficiencies.
While the country has an OPEC+ target of 1.8 million barrels per day, actual production has hovered around 1.4 to 1.5 million bpd, far below expectations and the 2.06 million bpd benchmark used in the 2025 national budget.
As a result, OPEC+ has continued to sideline Nigeria in recent quota revisions, deepening the country’s isolation within the cartel and highlighting the seriousness of its internal oil sector problems.
“This is a very unfortunate development for Nigeria,” said an oil analyst in Abuja. “Not only are we failing to meet our own targets, but we are also being left behind as others capitalize on rising demand.”
The timing of the output increase is particularly troubling for Nigeria, which is already grappling with dwindling government revenue, rising debt, and a volatile naira. The 2025 federal budget assumes an oil price of $75 per barrel, but current Brent crude prices are hovering around $68—and could fall further due to the anticipated supply surge.
Economists warn that lower oil prices combined with stagnant output could push Nigeria into deeper fiscal stress, potentially derailing budget projections and slowing capital projects.
“The government faces a serious dilemma,” noted a financial expert. “With no production increase in sight and lower oil prices looming, Nigeria could see severe revenue shortfalls that may force additional borrowing or spending cuts.”
The OPEC+ production boost signals a strategic pivot by the oil bloc, which had previously implemented deep output cuts to stabilize prices during the COVID-19 pandemic and in the face of global economic uncertainty. With demand now rising, especially in non-OPEC economies, key producers are focusing on regaining market share—even if it puts downward pressure on prices.
Analysts believe the latest decision could send oil prices tumbling to around $60 per barrel in the coming months, particularly if global inventories remain high and economic recovery falters in key markets like China and the U.S.
For Nigeria, the exclusion from this round of OPEC+ increases underscores an urgent need to reform its oil sector. Industry experts have called for immediate investment in oil infrastructure, resolution of insecurity in the Niger Delta, and a clampdown on theft and corruption in the petroleum supply chain.
Until Nigeria can improve its reliability as a producer, it risks becoming increasingly irrelevant in OPEC+ decisions, with serious implications for its economy and national budget.
“This is a wake-up call,” said a former NNPC executive. “The rest of OPEC+ is moving forward, and Nigeria is being left behind. We need to fix our house, or risk losing even more ground.”
As the global energy landscape shifts, Nigeria’s future in the oil market now hinges not just on external prices, but on its internal capacity to deliver.
