Nigeria earned an estimated N5.13 trillion in oil revenue windfalls in March and April, driven by a surge in global crude prices linked to tensions between the United States and Iran, far exceeding the Federal Government’s 2026 budget projections.
The 2026 budget is based on oil production of 1.8 million barrels per day, a benchmark price of $64.85 per barrel and an exchange rate of N1,400 to the dollar. This translates to expected daily revenue of about $116.73 million, or roughly N163.42 billion.
However, actual earnings in the two months surpassed this benchmark, largely due to higher crude prices.
Data from the Nigerian Upstream Petroleum Regulatory Commission showed that production averaged 1.55 million barrels per day in March, below the budget target. But with an average crude price of $95.03 per barrel and an exchange rate of N1,370, daily revenue rose to about $147.3 million, or N201.8 billion.
This represents a daily surplus of N38.38 billion over the benchmark, resulting in an estimated windfall of N1.19 trillion for the 31-day period.
In April, both production and prices increased. Output was estimated at 1.7 million barrels per day, while the average crude price rose to $127.05 per barrel. At an exchange rate of N1,365, daily revenue climbed to about $216 million, or N294.84 billion.
Compared to the benchmark, this yielded a daily surplus of N131.42 billion and a total windfall of about N3.94 trillion for the month.
Combined, the windfall for March and April is estimated at N5.13 trillion.
Analysts say the surge in oil prices, rather than increased production, was the primary driver of the higher revenue. Production remained below target in March, yet earnings exceeded projections due to stronger prices.
The development provides short-term fiscal relief but underscores Nigeria’s vulnerability to volatility in global oil markets, as revenue performance remains heavily dependent on external price movements.
Without the price surge, revenues would have been significantly lower. At the benchmark price of $64.85 per barrel, March earnings would have dropped to about N137.71 billion per day, while April revenue would have been around N150.5 billion per day.
Despite higher government earnings, rising crude prices have translated into increased fuel costs domestically.
The Nigerian National Petroleum Company Limited recently raised official selling prices for all 37 Nigerian crude grades for May-loading cargoes, increasing Bonny Light by $6.13 per barrel and Forcados by $7.01.
Fuel prices have also risen. The Dangote Petroleum Refinery increased its gantry price to N1,275 per litre from N1,200, while retail pump prices climbed to between N1,350 and N1,400 in many locations.
Industry stakeholders have called for government intervention to cushion the impact on citizens.
Billy Gillis-Harry, president of the Petroleum Products Retail Outlet Owners Association of Nigeria, said authorities should introduce measures to offset rising transport and food costs.
Energy economist Adeola Adenikinju described the situation as a “two-edged sword,” noting that while higher oil prices boost government revenue, they also drive inflation and increase hardship for households.
He called for targeted cash transfers to vulnerable Nigerians but noted that the lack of a reliable database remains a major constraint.
Local refiners also urged the government to adopt a domestic pricing model for crude supplied to refineries, rather than relying on international benchmarks such as Brent, which they say inflates costs.
Economist Bismarck Rewane suggested the government could consider selling crude at fixed prices to domestic refineries in exchange for stable fuel prices.
The revenue surge highlights both the immediate fiscal gains from higher oil prices and the risks associated with dependence on volatile global markets, as any decline in prices could sharply reduce earnings.
