Usman Muhammed, Lecturer of Political Science Department at the Kaduna State University, has revealed that Nigeria is losing an estimated $15 billion annually to oil theft and pipeline vandalism, raising questions about the long-term sustainability of President Bola Tinubu’s Renewed Hope Agenda beyond 2027.
Speaking at the 1st Citizens Engagement Conference held in Kaduna on Monday centred on “The Positive Impact of Oil and Gas Reforms by President Bola Tinubu”, Muhammed said that regulatory excellence and upstream oil and gas performance are key levers for economic transformation.
The academic don explained that while Nigeria is richly endowed with an estimated 37 billion barrels of crude oil and 209 trillion cubic feet of natural gas, inefficiencies in governance, policy inconsistency, and infrastructural decay had limited the sector’s contribution to national development. “Despite being Africa’s largest oil producer, Nigeria continues to struggle with declining productivity and fiscal leakages,” he noted.
He said that a study had highlighted that between 2019 and 2024, Nigeria’s crude oil production averaged 1.4 to 1.67 million barrels per day, below its OPEC quota of 1.8 million barrels, while inflation soared above 22% and unemployment remained around 33%.
Muhammed, who is a Professor, stressed that the Petroleum Industry Act (PIA) 2021 represents a landmark reform. By establishing the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the law aimed to enhance transparency, attract investment, and improve fiscal discipline.
“Implementation of the PIA and the transition of the Nigerian National Petroleum Corporation (NNPC) into a commercial entity have begun to yield results, but production efficiency and local content development remain moderate due to enforcement challenges,” he said.
Data from the study show a strong positive correlation (r = 0.74) between oil production and GDP growth, indicating that improvements in upstream output can directly boost national economic performance. Regression analysis further revealed that regulatory quality (β = 0.517) and investment inflows (β = 0.301) are significant predictors of GDP, explaining 81% of the variation.
Comparative analysis with countries like Norway, Saudi Arabia, and the United States shows that Nigeria lags behind in regulatory efficiency, scoring 63 out of 100, compared to Norway’s 92 and the US’s 90. Experts at the Conference noted that weak institutional coordination, outdated infrastructure, and limited technological adoption continue to hinder full sectoral optimisation.
The conference heard that oil theft, pipeline sabotage, and bureaucratic bottlenecks remain major challenges. Muhammed emphasised that addressing the issues are critical to ensuring that oil revenues translate into sustainable development, job creation, and fiscal stability.
He further stressed the importance of policy stability, fiscal transparency, and technological modernization in the upstream sector. “Economic prosperity beyond 2027 will not be determined solely by oil output but by how effectively Nigeria institutionalizes regulatory excellence and diversifies energy sources”, he said.
