Business

Debt Servicing May Take All Of Nigeria’s Revenue By 2026, IMF Warns

Published

3 years ago

June 1, 2022

The Nigerian government may spend nearly 100 per cent of its revenue on debt servicing by 2026, the International Monetary Fund (IMF) has warned.

The Bretton Wood institution raised concerns over Nigeria’s fiscal conditions, adding the nation spends 89 per cent of its revenue on debt.

The IMF’s Resident Representative for Nigeria, Ari Aisen, made this known on Monday in Abuja while presenting the fund’s latest Sub-Saharan Africa Regional Economic Outlook report.

IMF also warned that with fuel subsidy payments averaging N500 billion monthly, total expenditure on subsidy could hit a record N6 trillion by the end of the year.

“I think the biggest critical aspect for Nigeria is that we have done a macro-fiscal stress test, and what you observe is the interest payments as a share of revenue and as you see us in terms of the baseline from the federal government of Nigeria, the revenue, almost 100 percent, is projected by 2026 to be taken by debt service,” the IMF official said.

“So, the fiscal space or the amount of revenues that will be needed, and this, without considering any shock, is that most of the revenues of the federal government are now in fact 89 percent and it will continue, if nothing is done, to be taken by debt service.”

The IMF said that it is a reflection of the low revenue of the country, adding that it needs to mobilise more revenue to be able to have macroeconomic stability.

“It has become an existential issue for Nigeria,” Mr Aisen warned.

Subsidy
The IMF official lamented that as an oil exporter, Nigeria is unable to take advantage of the current global high oil prices to build reserves. The nation is equally confronted by low earnings due to the subsidy on petroleum products, he said.

Earlier in April, the Nigerian Senate approved N4 trillion for petrol subsidy in 2022, following two separate requests by the Nigerian president to the National Assembly. The government had shelved a planned move to suspend the subsidy payment a few weeks earlier.

In the midst of the uncertainties, the World Bank Group urged Nigeria to rethink its fuel subsidy regime and multiple exchange rates policy. Speaking during a media briefing at the World Bank/International Monetary Fund Spring Meetings in Washington DC, the president of the World Bank Group, David Malpass, said that resources being expended on subsidy could be channeled to other sectors of the economy to accelerate growth.

“One is that they are expensive because they go to everyone and they are often used by people with upper incomes than by people with lower incomes so they are not targeted,” he said.

“So, we encourage that when there is need for subsidy, either food or for fuel, that it should be carefully targeted at those most in need of it. And so, we have encouraged Nigeria to rethink its subsidy effort.”

In its intervention Monday, the IMF official reiterated the World Bank’s warning, adding that subsidy payments could worsen the nation’s fiscal challenges due to poor earnings from oil.

Speaking on the economic outlook for the continent, the IMF official advised governments across the region to reduce debt vulnerabilities, balance inflation and growth, and manage foreign exchange rate pressures.

“Unrivalled potential for renewable energy and an abundance of minerals, a successful transition offers opportunities for diversification and job creation; ensuring the green transition is also a just transition,” he said.

Business

Why Nigeria’s Crude Oil Production Dropped To 1.63mbpd In August – NUPRC

Published

13 hours ago

September 21, 2025

Editor

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has explained that unscheduled maintenance at a refinery facility made Nigeria’s crude oil production drop on a month-on-month basis in August.

This comes as Nigeria’s crude oil production dropped to 1.63 million barrels per day month-on-month in August, down from 1.71 million bopd in July.

NUPRC disclosed this in its Crude Oil and Condensate Production for August 2025, released on Saturday.

This means a 4.7 per cent drop in combined crude oil and condensate production from 1.71 million bopd in July.

In the same vein, crude oil production itself declined by 4.8 per cent, down from 1.5 million bopd in July 2025.

“The month-on-month drop was driven by a single-day unscheduled maintenance at an oil facility.

“In the month of August, the lowest and peak combined crude and condensate production were 1.59 million bopd and 1.85 million bopd, respectively,” NUPRC said.

The data showed that while there was a decline month-on-month, the country’s crude oil production rose on a year-on-year basis by 5.5 per cent to 1.63 mbpd in August this year from 1.58 million bopd in the same period last year.

Further analysis indicates that daily condensate production in August stood at 197,229 bpd, reflecting a decline.

Also, Nigeria’s crude oil output in August achieved 96 per cent of its OPEC quota, which is set at 1.5 million bopd.

Accordingly, in the period under review, Forcados Terminal topped the production charts, delivering a total of 8.99 million barrels, including 8.08 million barrels of crude oil and 915.2k barrels of condensates.

Business

Marketers Get Dangote’s Free Fuel Supply

Published

2 days ago

September 20, 2025

Editor

Marketers on Friday confirmed that Dangote Refinery’s compressed natural gas-powered trucks have started delivering fuel to their stations at no cost to them.

The National President of the Independent Petroleum Marketers Association of Nigeria, Abubakar Shettima, confirmed this to our correspondent in an interview on Friday.

Recall that Dangote Refinery rolled out over 1,000 CNG trucks on Monday, saying the entire 4,000 would be in the country before October.

The direct fuel distribution scheme was initially scheduled to commence on August 15, but was delayed due to logistics challenges in China.

A total of 4,000 CNG trucks were ordered from China for delivery in Lagos. However, the plan was stalled as there were insufficient vessels to transport the trucks.

Speaking with our correspondent, the IPMAN president said independent marketers in the South West have started receiving the trucks in their stations to offload petroleum products.

Shettima said only registered marketers can receive the free delivery from Dangote Refinery.

He said the stopping of fuel sales to unregistered marketers by the refinery is not a big deal, as marketers can register on the Dangote portal anytime they are ready.

“If you don’t register, your name will not appear on the system unless you register through the portal, which the company has been announcing for a long time. But marketers can register at any time, even at night, because it’s not difficult. You will just input all your information and register. So, that one is not an issue at all,” Shettima said.

He told our correspondent that marketers in Lagos, Ogun and Ondo have confirmed the receipt of Dangote’s logistics-free fuel.

“Dangote has started the free delivery. Already, the trucks have started moving. In most parts of the Western Zone, they have already started discharging their products, since it is closer to Lagos. So the plan is moving seriously. And my marketers are very pleased with the development.

“I can confirm to you that my members have started receiving the trucks in Lagos, Ondo, Ogun, Ibadan and others,” Shettima stated.

Speaking on the price, the IPMAN boss explained that prices would drop from N865 to N841 the moment petrol gets to the stations under the new arrangement.

“The prices have started coming down; even here now, when you push it to Abuja, you will see the price reduction. Wherever he discharges, all the independent marketers, anywhere he discharges, you will see there will be a price change.

“The MRS filling stations have started reducing prices, they have with independent petroleum marketers. Any marketer who applies for the product and receives it will reduce the price,” he stressed.

Business

Dangote Fuel Sells Cheaper In Togo Than In Nigeria – Falana Laments

Published

7 days ago

September 15, 2025

Editor

Human rights activist Femi Falana, SAN, has lamented that fuel taken from Dangote is cheaper in Togo than in Nigeria.

Falana expressed his concerns on Sunday while responding to questions in an interview on Politics Today, a programme on Channels Television.

He urged the federal government to review the proposed 5 per cent fuel surcharge and ensure that further hardship is not imposed on Nigerians.

“I guess the government wants to go back to the drawing table and ensure that it is not accused of multiple taxes or double taxation because consumers will pay VAT for buying fuel. They will now put an additional 5 per cent tax.

“I think this is what Nigerians are complaining about. And from what we just read today is that the Dangote fuel taken from Nigeria is now cheaper in Togo than in Nigeria I think about 65 naira.

“So, the government will have to review these developments (the proposed 5 per cent fuel surcharge) and ensure more hardship is not imposed on Nigerians,” he said.