From Victor Osula, Abuja
Nigeria’s oil revenue performance suffered a major setback in the third quarter of 2025, falling far below government projections and exposing the nation’s fragile fiscal position despite slight improvements in earnings.
According to the latest Fiscal Performance Report released by the Budget Office of the Federation, gross oil revenue for Q3 2025 stood at N4.87 trillion, representing a staggering shortfall of N7.88 trillion or 61.8 percent below the quarterly budget target of N12.76 trillion.
The development raises fresh concerns over Nigeria’s heavy dependence on crude oil earnings at a time of rising debt obligations, widening fiscal deficits, and intensified government efforts to boost non-oil revenue through tax reforms and improved collection systems.
Under the 2025 fiscal framework, the Federal Government projected total federally collectable revenue of N78.08 trillion, with oil expected to contribute N51.05 trillion about 65.38 percent of the total estimate.
This translates to a quarterly revenue benchmark of roughly N19.52 trillion.
Although the Q3 oil earnings reflected a marginal increase from the N4.77 trillion generated in Q2 2025 and N4.62 trillion recorded in the same period in 2024, the gains remained insignificant compared to budget expectations.
The Budget Office noted that actual oil revenue grew by 2.1 percent quarter-on-quarter and 5.41 percent year-on-year.
A breakdown of the figures revealed severe underperformance across key oil revenue sources. Crude Oil and Gas Sales generated N622.99 billion against a target of N1.18 trillion, while Petroleum Profit Tax and Gas Taxes brought in N1.97 trillion, missing projections by N5.87 trillion.
Oil and Gas Royalties also fell short by N1.42 trillion, while Incidental Oil Revenue generated only N37 billion compared to the expected N295.88 billion.
Nigeria’s oil sector continues to struggle under the weight of weak production performance and revenue leakages, leaving government finances under intense pressure.
The massive N7.88 trillion shortfall underscores the urgent need for deeper fiscal reforms, stronger revenue diversification, and improved efficiency in the nation’s oil and gas industry.
With oil still accounting for the bulk of government earnings, continued underperformance could further widen deficits and increase borrowing pressures in the months ahead.
