Nigeria has achieved its lowest level of crude oil theft in 16 years, a development analysts say could ease pressure on the foreign exchange market, boost fiscal revenues, and restore investor confidence in the country’s oil and gas sector.
Afrinvest, in its latest macroeconomic research note, cited data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which showed that crude oil losses dropped to 9,600 barrels per day in July 2025. This marks the lowest figure since 2009, when losses were 8,500 barrels per day. The new data represents a 15 per cent improvement from the 2024 average of 11,300 bpd and an extraordinary 90.7 per cent decline from the 102,900 bpd recorded in 2021.
The research firm attributed the turnaround to reforms under the Petroleum Industry Act of 2021, coupled with stronger collaboration between regulators, security agencies, host communities, and industry operators. It said that measures such as metering audits across upstream facilities and tighter oversight had been critical in plugging revenue leakages that plagued the sector for years.
Afrinvest noted that the sharp decline in crude oil theft could provide fiscal relief for the Federal Government at a time when its finances are under pressure. Although Nigeria’s crude production remains below the official target of 2.01 million barrels per day set in the 2025 budget, actual output stood at 1.51 million bpd in July. The lower theft rate means more crude is available for export, which translates to higher inflows into the Federation Account Allocation Committee (FAAC).
The firm also highlighted the foreign exchange benefits of the development, pointing out that crude oil exports account for about 85 per cent of Nigeria’s FX earnings. With more crude available for sale, Afrinvest projected improved liquidity in the foreign exchange market and stronger external reserves. This comes at a time when the naira has already shown signs of stability, appreciating by 2.4 per cent so far in 2025 to N1,501.50 per dollar, largely supported by Central Bank of Nigeria reforms.
Beyond fiscal and FX gains, Afrinvest stressed that the progress against oil theft could also help restore investor confidence in the oil and gas sector. In recent years, several international oil companies scaled down their investments or divested from onshore assets due to security challenges, including theft and pipeline vandalism. According to the firm, the new trend could rekindle investment appetite, particularly in the upstream sector, which would help lift production capacity and strengthen Nigeria’s fiscal and external buffers.
“Higher export volumes, stemming from reduced crude oil losses, should result in improved FX liquidity and external reserves, thereby easing pressure on the naira,” the firm noted in its report.
Afrinvest, however, cautioned that while production levels still lag government targets, the progress reflects a structurally positive development. “It signals improved governance and regulatory vigilance in the oil sector and marks another step in Nigeria’s journey toward ramping up oil production and shoring up fiscal revenue,” the firm concluded.
