Crude Shock: Nigeria’s 2025 Budget Faces Collapse as Oil Price Plummets to $60
Nigeria’s 2025 budget already labeled by critics as more political than practical is now hanging by a thread as Bonny Light crude plunged to an alarming $60 per barrel, far below the $75 benchmark on which the entire fiscal framework was built.
Oil, the lifeblood of Nigeria’s economy, is bleeding fast.
Despite ambitious projections of over 2 million barrels per day (bpd), including condensates, actual production has tumbled to just 1.6 million bpd, according to fresh figures from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC). That’s a staggering 400,000 bpd shortfall. In budgetary terms, that’s not just a gap it’s a crater.
In a development that spells serious trouble for public spending, salaries, and infrastructure plans, global oil prices have been battered by a flood of increased output from major producers. As the OPEC+ alliance begins dismantling its voluntary output cuts, markets have been flooded with an extra 411,000 barrels per day, pushing prices down further.
The implications are grim.
“This drop is a fiscal disaster waiting to unfold,” said Olatide Jeremiah, CEO of Petroleum Price NG, in a chat with Vanguard. “The entire 2025 budget is at risk. The implementation is now in doubt.”
And the downstream sector isn’t spared either. With depot prices poised to fall after the holiday season, marketers are watching closely, although cheaper pump prices may offer temporary relief to consumers.
Farouk Ahmed, CEO of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), echoed the economic alarm: “Consumers might cheer cheaper oil, but as a nation, our lifeline is being cut off. Revenue is drying up.”
Adding to the global volatility is the erratic policy signaling from Washington. “What’s destabilizing the market even more,” Ahmed added, “is the unpredictability of President Trump. He announces one thing today, then reverses it tomorrow. Markets hate that kind of inconsistency.”
A Budget Built on Sand?
As oil prices slide and production underperforms, analysts are warning that Nigeria’s 2025 budget is fast turning into a mirage. Some insiders already dub it a “political document”—designed more to appease than to function.
The question is no longer if adjustments will be made, but how deep the cuts will go and who will bear the brunt.
Reference
Crude Shock: Nigeria’s 2025 Budget Faces Collapse as Oil Price Plummets to $60