Nigeria eyes faster growth as oil production recovers

Nigeria is targeting faster economic growth in 2026 as recovering crude oil production, structural reforms, and improved macroeconomic conditions strengthen prospects despite prevalent risks. Nigeria’s real Gross Domestic Product growth for 2026 is projected to range between 4.1 per cent and seven per cent, reflecting stronger economic momentum supported by structural reforms and a rebound in the oil sector. Following the 4.43 per cent GDP growth recorded by the country, as released by the National Bureau of Statistics in the second quarter, analysts said the performance in the second half of the year would continue to be influenced by domestic and external risks. The projections vary among major institutions. The World Bank expects Nigeria’s economy to grow by 4.4 per cent, citing stronger resilience and better-than-expected economic performance. The International Monetary Fund projects real GDP growth at 4.1 per cent, while PwC Nigeria estimates expansion at 4.2 per cent, driven by improved crude oil production and performance in key sectors. The Federal Government is targeting about 4.68 per cent growth, while domestic groups such as the Lagos Chamber of Commerce and Industry have a more ambitious outlook of up to seven per cent. A key factor running through the different projections is the expected contribution of the oil sector, which remains central to economic performance, particularly through revenue inflows. The growth outlook will therefore depend largely on higher crude oil production and stronger performance across dominant sectors. With crude oil exports accounting for over 80 per cent of Nigeria’s foreign exchange earnings, sustained inflows from oil exports are expected to remain important to the achievement of the projected growth rates. The Nigerian Upstream Petroleum Regulatory Commission is leading the push to achieve the 2.5 million barrels per day target, with plans to revive dormant oil fields, unlock deepwater resources, and attract new foreign investments into the sector. Nigeria has shown sustained growth in its crude and condensate output so far this year. Total oil output rose from 1.48 million bpd in February to 1.735 million bpd in June, according to the NUPRC. Nigeria is actively increasing its crude oil production in response to major global supply disruptions caused by the war in Iran. Analysts said sustaining investment and increasing exploration activities were critical to raising production and strengthening the nation’s reserves. They also stressed the need for a comprehensive framework to increase production, expand reserves and improve the oil sector’s contribution to national economic development. Achieving these objectives requires continued protection of oil assets, infrastructure repairs and sustained industry reforms. The operations of Tantita Security Services Nigeria Ltd in the Niger Delta are part of the wider effort to secure oil infrastructure. The Federal Government appointed TSSNL to protect oil assets and support peace and stability in the Niger Delta. President Bola Ahmed Tinubu appointed TSSNL, led by High Chief, Government Ekpemupolo, alias Tompolo, to protect Nigeria’s oil assets in the Niger Delta region. The TSSNL works in collaboration with other security outfits in securing oil assets and maintaining stability in the Niger Delta. Tantita’s pipeline surveillance operations have been linked to efforts to curb oil theft and protect the flow of petroleum resources. A recent survey also captured the impact of pipeline surveillance operations in the Niger Delta, with the majority of respondents attributing the de-escalation of security incidents in the region to operations carried out by TSSNL. Oil asset protection TSSNL’s Media Consultant, Dr Paul Bebenimibo, said efforts to protect oil pipelines and other critical infrastructure in the Niger Delta had contributed to improved crude oil production, environmental safety and economic activities in the region. Bebenimibo, who is also Special Adviser to Tantita Chairman, Government Ekpemupolo, popularly known as Tompolo, spoke on the sidelines of an award presented to Tantita by Blueprint Newspapers in recognition of the company’s contributions to pipeline security and national development. He said the award recognised Tantita’s intervention in the Niger Delta, particularly in addressing oil theft, pipeline vandalism and other illegal activities affecting the oil industry. According to him, since Tantita assumed a major role in pipeline surveillance and protection in 2022, the company has made progress in securing oil facilities across the Niger Delta. “Over the years, awards have been coming in, and that shows that Tantita is really doing the job very well,” Bebenimibo said. He noted that improved security around oil-producing communities had also created an environment conducive to the revival of legitimate economic activities, including fishing and farming. Bebenimibo said Tantita remained committed to supporting efforts to increase Nigeria’s crude oil production to 2.5 million barrels per day, stressing that protection of oil infrastructure was critical to achieving the target. He attributed part of the company’s performance to the leadership and knowledge of the Niger Delta terrain possessed by its chairman, Tompolo. According to him, Tompolo’s familiarity with the creeks and communities had enabled the company to develop strategies for monitoring oil infrastructure. GDP rises 4.4% The National Bureau of Statistics said the Nigerian economy expanded in real terms by 4.43 per cent year-on-year in the second quarter of 2026, compared with 4.23 per cent in the corresponding quarter of 2025. NBS disclosed this in its Gross Domestic Product report for Q2’26, noting that both the oil and non-oil sectors grew during the period, by 7.3 per cent year-on-year and 4.3 per cent year-on-year, respectively. It said, “GDP grew by 4.43 percent YoY in real terms in Q2’26, higher than the 4.23 percent recorded in Q2’25. During the quarter under review, agriculture grew by 4.39 percent, an improvement from the 2.82 percent recorded in the corresponding quarter of 2025.” On oil sector growth, NBS noted that Nigeria recorded average daily oil production of 1.72 million barrels per day (mbpd) in Q2’26, compared with 1.68 mbpd in the same quarter of 2025. The figure was also 0.17 mbpd higher than the 1.55 mbpd recorded in Q1’26. “The real growth of the oil sector was 7.31 per cent (year-on-year) in Q2’26, indicating a decrease of 13.15 percentage points relative to the rate recorded in the corresponding quarter of 2025 (20.46 percent). “Growth increased by 4.74 percentage points when compared to Q1’26, which was 2.57 per cent. On a quarter-on-quarter basis, the oil sector recorded a growth rate of 10.91 percent in Q2’26. “The oil sector contributed 4.16 per cent to the total real GDP in Q2’26, up from the figure recorded in the corresponding period of 2025 at 4.05 percent and up from the preceding quarter, where it contributed 3.92 per cent,” NBS added. Tech deployment On ways to further help in ensuring sustained oil production, Bebenimibo disclosed that Tantita had deployed modern technology, including drones, to monitor activities in the creeks and detect illegal operations. “We have acquired drones that are now picking up every illegal activity that is going on in the creek,” he said, adding that illegal operators were increasingly finding it difficult to evade the company’s surveillance efforts. Beyond pipeline surveillance, Bebenimibo said Tantita had also focused on youth empowerment as part of its approach to insecurity in the region. He disclosed that more than 60,000 youths were currently employed by the company and paid monthly. He further said Tantita had introduced skills acquisition programmes and supported young people, women and other members of host communities through grants and other forms of economic empowerment. “Tantita is not just employing the youths. It is also giving them skills and promoting their businesses in the area by giving grants to youths, women and men,” he said. According to him, the combination of employment, skills development and community support had contributed to reducing criminal activities in parts of the Niger Delta. He expressed confidence that sustained collaboration among security agencies, oil companies, host communities, the media and private security contractors would strengthen the protection of Nigeria’s oil infrastructure and contribute to increased national revenue. Economic outlook Examining Nigeria’s H1 and H2 2026 Economic Outlook and reform journey, PwC Partner, Chief Economist and Lead Strategy & West Africa, Olusegun Zaccheaus; Partner, Clients & Market Leader, West Market, Pedro Omontuemhen; and Director, Akolawole Odunlami, agreed that macroeconomic conditions had continued to improve. They attributed the improvement to greater foreign-exchange stability, moderating inflation, stronger external reserves, higher revenue mobilisation and increased capital inflows. Insights from their “Unlocking Nigeria’s reform dividend: From macroeconomic stabilisation to inclusive growth” showed that the next step was to translate these gains into stronger household incomes, higher productivity, more jobs and broader-based economic growth. “Nigeria entered the second half of 2026 from a stronger macroeconomic position. Real GDP grew by 3.89 per cent year-on-year in Q1 2026, supported by ICT, Finance & Insurance, Construction and Agriculture. “Headline inflation moderated to 15.91 per cent in June, while the naira remained broadly stable at N1,379.68/$. Gross foreign reserves rose by 38.3 per cent per cent year-on-year to $51.46bn in June, providing a stronger external buffer and supporting confidence in the foreign-exchange market,” they said. On the other hand, household affordability remained under pressure, private-sector financing conditions were still tight, and growth remained concentrated in a relatively narrow group of sectors. External risks had also increased, particularly through geopolitical tensions, energy-market volatility and weaker global growth. These factors would influence how quickly Nigeria could move from macroeconomic stabilisation to more inclusive and sustainable growth. Nigeria’s economic outlook remained positive, although the second half of the year would continue to be shaped by domestic and external risks. Inflation is expected to moderate, although food-price pressures, other supply-side shocks and pre-election spending could create upside risks. Successfully navigating this next phase would require continued attention to oil production and asset security, alongside the broader economic reforms aimed at moving Nigeria from stabilisation towards higher incomes, improved welfare and more inclusive economic growth.