Oil sector shrinks 23% as oil production dips in Q3

The decline in oil production in July, August and September exposed the fragile state of Nigeria’s oil sector as the real growth of the country’s oil GDP stood at -22.67 percent, the latest data from the National Bureau of Statistics (NBS) has shown.

“Oil sector growth of –22.67 percent decreased by 10.91 percent when compared to the second quarter of this year which was –11.77 percent. Quarter-on-Quarter, the oil sector recorded a growth rate of -1.80 percent in Q3 2022,” NBS said in its latest quarterly report.

According to the NBS report, the oil sector contributed 5.66 percent to the total real GDP in Q3 2022, down from the figures recorded in the corresponding period of 2021 and the preceding quarter, where it contributed 7.49 percent and 6.33 percent respectively.

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Nigeria, in the third quarter of 2022 recorded an average daily oil production of 1.20 million barrels per day (bpd), lower than the daily average production of 1.57 million bpd recorded in the same quarter of 2021 by 0.37 million bpd and lower than the second quarter of 2022 production volume of 1.43 million bpd by 0.24 million bpd.

The Nigerian Upstream Petroleum Regulatory Commission in its oil production status report showed that Nigeria produced less than 1 million bpd in August and September.

During the third quarter of this year, the decline in oil output was due to rampant sabotage of oil and gas resources, production shut-ins with investors unwilling to commit resources to new projects while increasing pollution in the region.

In October, Mele Kyari, group chief executive officer, NNPC said that though oil theft in Nigeria has been going for over 22 years, the rate it has assumed in recent times in Unprecedented.