Nigeria Sees Sharp Decline in Oil Theft, Boosting Revenue Prospects – Afrinvest

Nigeria has recorded a major breakthrough in its fight against crude oil theft, with new data suggesting significant gains for public finances, foreign exchange stability, and investor confidence.

According to investment advisory firm Afrinvest, crude oil losses fell to just 9,600 barrels per day (bpd) in July 2025, based on figures from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC). This marks the lowest level in 16 years, with the last comparable figure recorded in 2009 at 8,500 bpd.

The July figure represents a 15% drop from the 2024 average of 11,300 bpd and an extraordinary 90.7% decline from the 102,900 bpd lost in 2021, when theft and sabotage peaked.

Reforms Driving Progress
Afrinvest credited the remarkable turnaround to structural reforms introduced under the 2021 Petroleum Industry Act (PIA), which strengthened governance and accountability across the sector. It also cited improved collaboration between regulators, security agencies, host communities, and operators.

Specific measures, including facility metering audits and tighter oversight mechanisms, have helped plug revenue leakages and restore confidence in the system.

“This signals improved governance and regulatory vigilance in the oil sector and marks another step in Nigeria’s journey toward ramping up oil production and shoring up fiscal revenue,” Afrinvest noted in its macroeconomic briefing.

Fiscal and FX Relief
The progress could not have come at a more critical moment. Despite oil production standing at just 1.51 million bpd in July—still well below the 2025 budget benchmark of 2.01 million bpd—the reduced theft ensures more crude reaches export markets.

Since crude oil provides about 85% of Nigeria’s foreign exchange earnings, higher export volumes are expected to boost inflows into the Federation Account and strengthen foreign reserves. This, Afrinvest argued, could ease persistent pressure on the naira.

The local currency has already gained modest ground in 2025, appreciating 2.4% year-to-date to trade at ₦1,501.50/$, helped by Central Bank of Nigeria (CBN) reforms.

Investor Sentiment Turning
Afrinvest further suggested that the new trend may rekindle investor appetite for Nigeria’s oil sector. Many international oil companies (IOCs) had scaled back operations in recent years, citing theft, pipeline vandalism, and security risks. Improved regulatory oversight and security coordination, the firm said, could unlock fresh capital inflows and stimulate upstream investment.