KEY POINTS
- Nigeria’s oil revenue in 2025 was 64 percent less than the Q1 projection.
- Non-oil revenue was also more than 22 percent below than expected.
- The lack of net distributable revenue raises worries about the stability of the economy.
The Budget Office of the Federation says that Nigeria’s oil revenue fell far short of budget goals in the first half of 2025. The shortage impacts the first two quarters of the year, which might have an impact on government spending and the stability of the economy.
The total amount of oil revenue for the first quarter of 2025 was N4.55 trillion, which was N8.21 trillion, or 64.35 percent, less than the quarterly goal of N12.76 trillion. The shortfall is bigger than the N3.35 trillion made in Q1 2024, but it shows that Nigeria’s oil-dependent revenue streams are still quite unstable.
Non-oil revenue also didn’t go well
The Budget Office said that gross non-oil revenue was N4.71 trillion in the first quarter. This was N1.34 trillion, or 22.18 percent, less than the expected N6.05 trillion.
The three levels of government had a net distributable revenue of N8.06 trillion after costs were taken out. This was 52.16 percent less than expected.
The federal government set the first-quarter budget at N10.22 trillion, expecting N5.25 trillion from oil and N4.97 trillion from other sources. Actual receipts were N4.95 trillion, which is 51.53 percent less than expected but 38.13 percent more than the same time last year.
Oil revenue in the second quarter is similar to the problems in the first quarter
In the second quarter, gross oil revenue went up a little to N4.77 trillion, but it was still N7.99 trillion, or 62.62 percent, shy of the N12.76 trillion goal. The number is 33.33 percent higher than it was in Q2 2024, when gross oil revenue was N3.18 trillion. However, the disparity between this number and the budgeted amount shows that there are still problems with the economy.
Economists say that Nigeria’s long-term fiscal stability and investor confidence are still at jeopardy since oil income is falling short. Even while non-oil revenue streams help a little, the fact that oil receipts are not doing well shows that we need to arrange our finances better and find other sources of income.
The Budget Office in Nigeria believes that the government would need to keep an eye on its expenditure, make smart decisions, and change its policies as needed to make sure it can still reach its development goals even when there are gaps in its earnings.
