Nigeria’s oil tax revenue rose to ₦6.8 trillion in 2025, reflecting stronger compliance, improved upstream profitability, and tighter enforcement across the petroleum sector.
Figures released by the Nigeria Revenue Service (NRS) show that collections increased from ₦5.8 trillion in 2024, marking a year-on-year growth of about 19 percent. The rise translates to roughly ₦1 trillion in additional revenue.
Oil tax receipts include Petroleum Profits Tax, Hydrocarbon Tax, and Company Income Tax (CIT) from upstream oil operations.
Company Income Tax Drives Growth
Upstream Company Income Tax accounted for the largest share of oil tax revenue during the year. Strong remittances from international oil companies and joint venture operators supported the increase.
Foreign Petroleum Profits Tax and Hydrocarbon Tax receipts also contributed significantly, while local remittances, including those linked to the Nigerian National Petroleum Company Limited, added to the overall total.
The NRS attributed the stronger performance to improved monitoring, stricter enforcement, and better compliance among operators.
Sharp Swings in Monthly Collections
Oil tax inflows fluctuated sharply throughout the year.
January recorded the lowest monthly inflow at ₦365.04 billion. Collections rose steadily in February and March before surging to ₦1.60 trillion in April, driven largely by higher upstream CIT payments.
Revenue fell in May and June but rebounded strongly in July, which posted the highest monthly collection of the year at ₦3.75 trillion. August remained strong, although below July’s peak.
Collections weakened again in September and October before recovering in November. December closed the year on a high note, with inflows reaching ₦2.59 trillion, supported by substantial upstream tax settlements.
The gap between the highest and lowest monthly collections exceeded ₦3 trillion, highlighting the uneven pattern of oil-related tax inflows.
Non-Oil Revenue Expands Faster
While oil tax revenue grew strongly, non-oil collections expanded even faster. Non-oil revenue increased from ₦15.9 trillion in 2024 to ₦21.5 trillion in 2025, representing a 35 percent rise.
Combined, oil and non-oil taxes generated about ₦28.3 trillion in total revenue for 2025. Oil taxes accounted for roughly 24 percent of the total, while non-oil sources contributed about 76 percent.
This shift reflects ongoing efforts to reduce fiscal dependence on crude oil earnings.
Production Recovery Supports Revenue
The rise in oil tax revenue coincided with a modest recovery in crude output. Data from the Nigerian Upstream Petroleum Regulatory Commission show that average crude production hovered between 1.4 million and 1.5 million barrels per day in 2025. Total output, including condensates, averaged around 1.6 million barrels per day.
Improved pipeline security, reduced crude theft, and the restart of previously shut-in wells supported the recovery.
However, Nigeria remained below its production quota under the Organization of the Petroleum Exporting Countries (OPEC) for much of the year. This suggests that higher tax collections stemmed more from improved compliance, stronger earnings, and large-scale settlements than from a sharp rise in output alone.
Overall, the 2025 figures indicate that fiscal reforms and tighter oversight are helping the government capture more value from existing oil production, even as broader revenue diversification continues.
Nigeria’s oil tax revenue rose to ₦6.8 trillion in 2025, reflecting stronger compliance, improved upstream profitability, and tighter enforcement across the petroleum sector.
Figures released by the Nigeria Revenue Service (NRS) show that collections increased from ₦5.8 trillion in 2024, marking a year-on-year growth of about 19 percent. The rise translates to roughly ₦1 trillion in additional revenue.
Oil tax receipts include Petroleum Profits Tax, Hydrocarbon Tax, and Company Income Tax (CIT) from upstream oil operations.
Company Income Tax Drives Growth
Upstream Company Income Tax accounted for the largest share of oil tax revenue during the year. Strong remittances from international oil companies and joint venture operators supported the increase.
Foreign Petroleum Profits Tax and Hydrocarbon Tax receipts also contributed significantly, while local remittances, including those linked to the Nigerian National Petroleum Company Limited, added to the overall total.
The NRS attributed the stronger performance to improved monitoring, stricter enforcement, and better compliance among operators.
Sharp Swings in Monthly Collections
Oil tax inflows fluctuated sharply throughout the year.
January recorded the lowest monthly inflow at ₦365.04 billion. Collections rose steadily in February and March before surging to ₦1.60 trillion in April, driven largely by higher upstream CIT payments.
Revenue fell in May and June but rebounded strongly in July, which posted the highest monthly collection of the year at ₦3.75 trillion. August remained strong, although below July’s peak.
Collections weakened again in September and October before recovering in November. December closed the year on a high note, with inflows reaching ₦2.59 trillion, supported by substantial upstream tax settlements.
The gap between the highest and lowest monthly collections exceeded ₦3 trillion, highlighting the uneven pattern of oil-related tax inflows.
Non-Oil Revenue Expands Faster
While oil tax revenue grew strongly, non-oil collections expanded even faster. Non-oil revenue increased from ₦15.9 trillion in 2024 to ₦21.5 trillion in 2025, representing a 35 percent rise.
Combined, oil and non-oil taxes generated about ₦28.3 trillion in total revenue for 2025. Oil taxes accounted for roughly 24 percent of the total, while non-oil sources contributed about 76 percent.
This shift reflects ongoing efforts to reduce fiscal dependence on crude oil earnings.
Production Recovery Supports Revenue
The rise in oil tax revenue coincided with a modest recovery in crude output. Data from the Nigerian Upstream Petroleum Regulatory Commission show that average crude production hovered between 1.4 million and 1.5 million barrels per day in 2025. Total output, including condensates, averaged around 1.6 million barrels per day.
Improved pipeline security, reduced crude theft, and the restart of previously shut-in wells supported the recovery.
However, Nigeria remained below its production quota under the Organization of the Petroleum Exporting Countries (OPEC) for much of the year. This suggests that higher tax collections stemmed more from improved compliance, stronger earnings, and large-scale settlements than from a sharp rise in output alone.
Overall, the 2025 figures indicate that fiscal reforms and tighter oversight are helping the government capture more value from existing oil production, even as broader revenue diversification continues.