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The Nigerian economy shrank further by 2.24% year-on-year in the third quarter on the back of a slump in oil production, the country’s economic mainstay, according to government figures Monday.
Nigeria, which was Africa’s largest oil producer until a few months ago, slipped into recession after its economy shrank by 2.06% in Q2, as the impact of militant attacks on oil facilities weighed on the country’s economy.
Data released on Monday by the National Bureau of Statistics showed that Nigeria’s oil production averaged 1.63 million b/d in Q3, lower than the average 1.69 million b/d output in Q2, and 25% lower than the 2.17 million b/d production a year ago.
«As a result, real growth of the oil sector slowed by 22.01% (year-on-year) in the third quarter of 2016. As a share of the economy, the oil sector contributed 8.19% of total real GDP, down from figures recorded in the corresponding period of 2015 and the preceding quarter of 2016 recorded at 10.27% and 8.26% respectively,» the government agency said.
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Nigerian oil output has fallen sharply this year as renewed militancy in the oil-rich Niger Delta region resurfaced after some years of relative calm.
Production was slashed from 2.2 million b/d earlier in the year after militants continued to bomb facilities, and at one point this year left four Nigerian crude export grades — Bonny Light, Brass River, Forcados and Qua Iboe — under force majeure.
The attacks have continued even with the government trying to reach a peace deal with militants and activists in the Niger Delta following Nigerian President Muhammadu Buhari meeting with leaders around three weeks ago.
Local media reported on Monday Buhari appealing to the militants to halt the attacks on oil facilities, and pledging his administration’s commitment to improving the economic and social infrastructure in the region.
–Staff, newsdesk@spglobal.com
–Edited by Maurice Geller, maurice.geller@spglobal.com
Read our related blog post: Red tape, not militancy, putting Nigeria’s oil future at risk
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