Nigeria Oil & Gas Market Size & Share Analysis - Industry Research Report - Growth Trends (2024)

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Nigeria Oil & Gas Market Size & Share Analysis - Industry Research Report - Growth Trends? ›

Nigeria Oil and Gas Market Outlook. In the Nigeria oil and gas market, the market for gas attained a volume of 1.37 MMT in 2022 and is expected to grow at a CAGR of 5.30% between 2023 and 2028, to reach 1.85 MMT in 2028.

Nigeria Oil and Gas Market Outlook. In the Nigeria oil and gas market, the market for gas attained a volume of 1.37 MMT in 2022 and is expected to grow at a CAGR of 5.30% between 2023 and 2028, to reach 1.85 MMT in 2028.

The market size of the Oil Drilling & Gas Extraction industry increased 65.5% in 2022.

With 18 operating pipelines and an average daily production of some 1.8 million barrels in 2020, Nigeria is the eleventh largest oil producer worldwide. The petroleum industry accounts for about nine percent of Nigeria's GDP and for almost 90 percent of all export value.

Crude Oil Production in Nigeria averaged 1840.87 BBL/D/1K from 1973 until 2023, reaching an all time high of 2475.00 BBL/D/1K in November of 2005 and a record low of 675.00 BBL/D/1K in February of 1983.

The oil and gas industry has faced a talent shortage for years due to an aging workforce, limited new/young talent entering the industry, and growing competition for talent with the technology industry.

Shell has a history of over 50 years in Nigeria and the largest footprint of all the international oil and gas companies operating in the country. Shell has been active in Nigeria since 1937.

The global market size was valued USD 88.05 billion in 2020 and USD 91.29 billion in 2021. The market is set to gain traction from the high demand for crude oil and the urgent need to refine it for usage in various applications. At the same time, the expansion of the oil and gas industry would affect growth positively.

World oil demand will climb by 2 mb/d in 2023 to a record 101.9 mb/d.

BP says demand for oil and gas will drop dramatically by 2050 in 'decisive shift' The share of fossil fuels as a primary energy source will fall from 80 percent in 2019 to between 55 and 20 percent by 2050, according to BP's annual energy outlook report.

Who is Nigeria biggest oil buyer? ›

According to tanker-tracking data compiled by Bloomberg, France, one of Nigeria's biggest buyers, took an average of 110,000 barrels daily of Nigeria's oil over the past year.

Reserves and refinery capacity

Africa's crude oil reserves remained stable in 2021, accumulating to 125.3 billion barrels. From a country perspective, Libya had the largest amount of crude oil reserves in the continent, 48.4 billion barrels, while the Nigerian reserves amounted to 36.9 billion barrels.

As of the fourth quarter of 2021, India and Spain were the main importers of crude oil from Nigeria.

Nigeria is the largest oil producer in Africa, and the fifth largest in the Organization of Petroleum Exporting Countries (OPEC). Oil for the past three decades has provided 90 percent of the foreign exchange earnings of Nigeria, financing 80 percent of total government revenue.

Nigeria recorded its lowest oil production volume of 0.937 million barrels per day in September 2022. The Federal Government and oil sector players blamed this on the massive crude theft in Nigeria's oil rich Niger Delta.

Nigeria was Africa's top crude oil producer in March 2023, with a production capacity of 1.2 million barrels per day (bpd). However, the country has reported the lowest production so far this year, according to the Nigerian Upstream Regulatory Commission.

Exploring and drilling for oil may disturb land and marine ecosystems. Seismic techniques used to explore for oil under the ocean floor may harm fish and marine mammals.

Nigeria, one of the largest producers of crude oil in the world, could not exploit the rising oil prices to generate more revenue for the country due to its inability to refine locally and meet the oil production quota set by the Organisation of Petroleum Exporting Countries (OPEC).

Nigeria Oil & Gas Upstream Industry Overview

The Nigerian oil and gas upstream market is mainly dominated by government-owned companies. Private companies operate in joint ventures and collaborations with NNPC, the national oil company of Nigeria.

Who controls Nigeria oil? ›

In the consideration of our geo-political aspect including the security consideration, it is patent that by the circ*mstance of composition of Nigerian Federal Government, the oil and gas resources are held in trust by the Federal Government on behalf of the Citizens of Nigeria for the overall benefit and development ...

China. China is ranked as the sixth-largest oil-producing country, extracting about 3,838,000 barrels of oil per day.

The global oil and gas analytics market size accounted for USD 6.92 billion in 2022 and it is projected to reach around USD 52.46 billion by 2032. What will be the CAGR of global oil and gas analytics market? The global oil and gas analytics market is poised to grow at a CAGR of 22.45% from 2023 to 2032.

1. United States. The US is by far the largest producer of natural gas in the world, and represents nearly a quarter of total global natural gas production.

The global industrial gases market size was valued at USD 99.99 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 7.42% from 2023 to 2030. The growth is primarily driven by the growing manufacturing industry in developing economies of the Asia Pacific region.

According to the U.S. Energy Information Administration's (EIA) International Energy Outlook 2021 (IEO2021), the global supply of crude oil, other liquid hydrocarbons, and biofuels is expected to be adequate to meet the world's demand for liquid fuels through 2050.

Brent crude oil price forecasts

Meanwhile, the ANZ WTI oil price forecast suggested the US oil to rise to $104 by the end of 2023, and stay at that level in 2024, averaging at $89 in 2023 and $104 in 2024. Fitch saw WTI crude to trade at $80 in 2023, before slowing to $70 in 2024, $60 in 2025 and $50 in 2026.

About this report

World oil demand is forecast to rise by 2.2 mb/d year-on-year in 2023 to an average 102 mb/d, 200 kb/d above last month's Report.

There are multiple external factors that affect this industry such as crude oil availability, oil price fluctuation, high transportation cost, as well as exposure to high uncertainties [5–9].

The industry struggled over the past decade as its overinvestment in fracking contributed to a global glut of oil and gas, depressing prices. In early 2020, global energy prices collapsed as COVID-19 pandemic restrictions choked off demand.

How competitive is the oil and gas industry? ›

The barriers to entry in the oil and gas sector are extremely strong and include high resource ownership, high startup costs, patents and copyrights in association with proprietary technology, government and environmental regulations, and high fixed operating costs.

Uzere is one of the largest oil producing communities in Nigeria. The Kingdom is also known for the production of groundnut, cassava and fish.

Nigeria is Africa's biggest oil producer. But the lack of operational oil refineries has left the industry in crisis, forcing the country to import fuel. Economists say the next government needs to diversify the economy.

Nigeria's petroleum is classified mostly as "light" and "sweet", as the oil is largely free of sulfur. Nigeria is the largest producer of sweet oil in OPEC. This sweet oil is similar in composition to the petroleum extracted from the North Sea. This crude oil is known as "Bonny light".

Nigeria Ranks 11th of 20 Countries With Largest Oil Reserves.

In 2021, crude oil exports from Nigeria accounted for over 76 percent of the country's total exports.

The United States imported 125,000 barrels of petroleum from Nigeria in 2021. Nigeria used to be among the largest suppliers of petroleum to the U.S. However, as Canada has increased its oil sands production, it has emerged as the main U.S. trading partner for petroleum products.

Russia is the world's largest exporter of oil to global markets and the second largest crude oil exporter behind Saudi Arabia.

Is oil production in Nigeria a blessing or a curse? ›

In Nigeria, oil has been more of a curse than a blessing. Weak institutions of state and poor governance in managing the vast revenues have led the country to fail to realise its full potential in a textbook example of what academics know as the “resource curse”.

How dependent is Nigeria on oil? Nigeria's federal and state governments remain heavily dependent on oil revenues, relying on it to deliver public goods and the use of oil dollars to service debt and bolster the national currency. The oil sector, however, has not significantly improved the well-being of Nigerians.

The Regional Coordinator for South-South, Nigeria Export Promotions Council (NEPC), Ganiyu Ahmed, has said Nigeria can survive without oil.

Oil Reserves in Nigeria

Nigeria has proven reserves equivalent to 237.3 times its annual consumption. This means that, without Net Exports, there would be about 237 years of oil left (at current consumption levels and excluding unproven reserves).

Nigeria's debt has exceeded its revenue in the first four months of the year despite high oil prices, Nigeria's Budget Office has revealed on its website.

Africa's two most profitable mineral resources are gold and diamonds.

Texas is by far the largest oil-producing state in the United States. In 2021, Texas produced a total of 1.7 billion barrels. In a distant second place is New Mexico, which produced 459.8 million barrels in the same year. Virginia is the smallest producing state in the country, at three thousand barrels.

Seychelles is the richest country in Africa, with a GNI per capita of $14,540. Mauritius follows closely with a GNI per capita of $9,920, while Libya is the third richest country in Africa with a GNI per capita of $8,700. South Africa is the fourth richest country in Africa with a GNI per capita of $6,530.

Gas Reserves in Nigeria

Nigeria has proven reserves equivalent to 306.3 times its annual consumption. This means it has about 306 years of gas left (at current consumption levels and excluding unproven reserves).

In recent years, industrial production and strong economic growth have boosted the oil demand, as seen in the increased demand in the fast-growing developing nations. Other important factors that affect oil demand include transportation, seasonable changes, and population growth.

What are the new challenges of the oil & gas industry? ›

With rising global demand, highly volatile prices and increasingly stringent environmental regulations, the oil and gas industry faces three major challenges : reduce costs, optimize the performance of its industrial base assets and improve its environmental footprint.

Nigeria sustained its position as the largest oil producer in Africa for two straight month, as it pumped 1.235 million barrels per day (bpd) in December, according to the Organization of the Petroleum Exporting Countries (OPEC) data.

As of the fourth quarter of 2021, India and Spain were the main importers of crude oil from Nigeria.

At current rates this would be 45 years of supply if no new oil was found. Pipeline vandalism, kidnappings, and militant takeover of oil facilities have reduced production, which could be increased to 3 million barrels per day (480×10³ m³/d) in the absence of such problems.

Oil demand has been increasing steadily, thus increasing the price of LPG. The embargos on Russian oil due to the war are also leading to the price increase. For Olufola Wusu, partner and head of oil and gas at Megathos Law Practice, domestic LPG prices are influenced by crude oil prices in the international market.

Up to 70 percent of the gas consumed locally in Nigeria comes from imports, even though the country is a major oil producer with huge gas reserves — ninth globally. Economists also say devaluation of the Nigerian naira currency and an unstable inflow of foreign exchange are driving up prices.

The price of oil fluctuates according to three main factors: current supply, future supply, and expected global demand.

So there are many factors that can have an impact on crude oil price that we can name some of them as weather, US economy, international economy, US dollar exchange rate comparing to other foreign currencies, geopolitical events, supply and demand statistics, and crude oil and petroleum distillates inventory.