Nigerian oil firms ramp up production expansion amid Middle East conflict

Indigenous oil producers in Nigeria are raising investment in near-term extraction projects as rising crude oil prices triggered by the Middle East conflict boost industry revenues and strengthen the country’s drive to increase oil production.

According to Bloomberg reports, several local upstream companies are reinvesting windfall earnings from the ongoing Iran-related oil market disruption into drilling campaigns and production expansion projects aimed at raising output before the end of the year.

The development comes as supply constraints linked to the closure of the Strait of Hormuz, a major global oil and gas shipping route, continue to tighten global crude supply and push international oil prices higher.

Industry stakeholders say the present oil market environment presents a rare opportunity for Nigerian producers to accelerate production growth and capture additional market share amid tightening global supply conditions.

Wale Tinubu, chief executive officer of Oando Energy Resources, said the company plans to increase production by 30 percent to about 42,500 barrels per day by year-end through the drilling of additional wells.

He said his company is also bringing forward a five-year plan to double production to “capture the demand shortfall that has been created by this conflict.

Similarly,  Wisdom Enang, a former manager at Exxon Mobil in Nigeria, said,  “It’s a good planning meeting opportunity.”

He said that output from Nigeria’s smaller producers could increase by an average of 250,000 bpd before the end of 2026.

According to several energy experts, elevated crude prices are improving the commercial viability of new drilling campaigns and attracting stronger investor interest in Nigeria’s oil sector.

In April, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) reported that Nigeria’s oil production rebounded strongly, with the country recording a combined daily average output of 1.66 million barrels per day of crude oil and condensates.

The body noted that Nigeria supplied 28.5 million barrels of crude oil to domestic refineries in the first quarter of 2026.

Nigeria’s crude oil production stood at 1.459 million barrels bpd in January 2026, before dropping to about 1.31 million bpd in February, and later recovering to 1.38 million bpd in March, according to data from the Organisation of the Petroleum Exporting Countries.