Economy
CBN blames ageing pipelines for oil revenue crash
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The Central Bank of Nigeria has attributed the significant decline in oil revenue for the third quarter of 2024 to ageing pipeline infrastructure and operational inefficiencies.
According to the apex bank’s latest economic report for the third quarter of 2024, oil revenue fell by 24.72 per cent to N1.30tn compared to the second quarter of 2024.
This drop was largely due to lower receipts from petroleum profit tax and royalties.
Also, the revenue figure fell short of the quarterly target by 75.39 per cent, primarily due to frequent shut-ins caused by deteriorating pipelines and installations.
The report read, “Oil revenue, however, fell by 24.72 per cent to N1.30tn, relative to the level in Q2 2024 on account of lower receipts from petroleum profit tax and royalties.
“It was also 75.39 per cent short of the quarterly target due to shut-ins, arising from ageing oil pipelines and installations.”
It also noted that despite a modest increase in crude oil production to 1.33 million barrels per day from 1.27 mbpd in the preceding quarter, challenges including theft, vandalism, and infrastructure deficits severely hampered Nigeria’s oil revenue performance.
The ageing infrastructure not only reduced efficiency but also undermined the country’s ability to meet its OPEC production quota.
The report noted that global factors further compounded the situation, as the average spot price of Nigeria’s Bonny Light crude fell by 5.45 per cent to $82.23 per barrel during the quarter, reflecting subdued demand in the global market.
Similar declines were observed in other crude benchmarks, including Brent and the OPEC Reference Basket.
While the oil sector struggled, the Nigerian economy recorded growth of 3.46 per cent in Q3 2024, up from 3.19 per cent in the second quarter, driven largely by the non-oil sector, which contributed 3.18 percentage points to total GDP growth.
The oil sector’s growth slowed to 5.17 per cent year-on-year, compared to 10.15 per cent in the previous quarter, as operational inefficiencies and declining crude oil prices took a toll.
The fiscal implications were significant, with federally collected revenue falling 23.71 per cent short of the budget benchmark, despite a 7.48 per cent quarter-on-quarter increase.
The fiscal deficit, although narrowing by 22.51 per cent compared to the previous quarter, widened by 43.88 per cent relative to the quarterly target, reflecting ongoing fiscal pressures.
The report concluded that Nigeria’s goal of achieving an oil production target of 2mbpd by the end of 2024 remains under threat due to these challenges.
The United Kingdom has introduced new restrictions on a chemical commonly used in some gel nail polishes amid concerns over its potential impact on fertility and reproductive health.
The restriction targets trimethylbenzoyl diphenylphosphine oxide, commonly known as TPO, a photoinitiator that enables gel polish to harden when exposed to UV light and helps improve its durability and colour retention.
Under the new rules, which took effect on Saturday across England, Wales and Scotland, manufacturers are no longer permitted to place new TPO-containing cosmetic products on the UK market.
However, beauty salons have been given until February 14, 2027, to stop using existing products containing the chemical, meaning customers could still encounter TPO-based gel polishes during the transition period.
The move follows concerns arising from animal studies that have linked TPO exposure to possible reproductive and fertility problems. The European Union introduced a similar prohibition in September 2025.
The restrictions have nevertheless attracted debate within the cosmetics industry. The Cosmetic, Toiletry and Perfumery Association has maintained that the concentration of TPO used in nail products is significantly lower than levels associated with harmful effects.
The UK decision is therefore expected to intensify discussions within the beauty industry over whether precautionary restrictions should take priority where potential reproductive risks remain under investigation.
Investors in the Nigerian stock market recorded a cumulative loss of N5.45 trillion as the equities market extended its bearish run to an eighth consecutive session at the close of trading session on Thursday night, August 20..
Equities listed on the Nigerian Exchange Limited, NGX, have continued to experience significant declines since Tuesday, August 11, 2026 but last week, investors on the NGX lost N3.8 trillion in four consecutive bearish sessions.
From Monday to Thursday this week, stocks on the NGX have lost a total of N1.65 trillion meaning that the combined losses recorded over the last eight trading sessions amounted to N5.45 trillion, wiping out previous gains in the market.
The market extended its bearish run on Thursday as investors lost N440 billion, driven by continued profit-taking in large- and mid-cap stocks.
Market capitalisation declined by 0.30 per cent, or N440 billion, from N155.417 trillion at the opening of trading to N154.977 trillion at the close.
The Naira yesterday depreciated to N1,405 per dollar in the parallel market from N1,400 per dollar on Wednesday.
But the naira appreciated to N1,347.5 per dollar in the Nigerian Foreign Exchange Market, NFEM.
Data from the Central Bank of Nigeria, CBN, showed that the indicative exchange rate for the naira fell to N1,347.5 per dollar from N1,351 per dollar on Wednesday, indicating N3.5 appreciation for the naira.
Consequently, the margin between the parallel and official markets widened to N57.5 per dollar from N49 per dollar on Wednesday.
The interbank turnover at NFEM rose by 0.22 percent to N371.8 million yesterday from N370.98 million the previous day.
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