Nigeria’s petroleum profit and gas tax revenue recorded a shortfall of N17.4 trillion against its target for the first three quarters, underscoring the growing impact of lower crude oil production and declining international oil prices on government earnings.

The figures are contained in data released by the Budget Office of the Federation.

According to the data, Petroleum Profit Tax and Gas Taxes posted the largest revenue gap among major oil revenue sources, while crude oil and gas sales, royalties and other petroleum-related earnings also fell below budget expectations.

The latest revenue performance highlights the continued vulnerability of Nigeria’s public finances to fluctuations in crude oil output and global energy prices despite ongoing efforts by the government to strengthen revenue generation.

Budget Office data showed that several critical oil revenue streams recorded significant shortfalls during the review period.

Petroleum Profit Tax and Gas Taxes generated N6.14 trillion compared to a projected N23.54 trillion, resulting in a deficit of N17.40 trillion or 73.92 per cent below target.

Revenue from Crude Oil and Gas Sales stood at N1.33 trillion against a budget projection of N3.53 trillion, leaving a shortfall of N2.20 trillion.

Oil and Gas Royalties generated N5.54 trillion compared to an expected N10.30 trillion, representing a revenue gap of N4.75 trillion.

Incidental Oil Revenue amounted to N475.90 billion, falling short of its budget target of N887.65 billion by N411.74 billion.

The combined deficits across these major oil revenue sources reflect the mounting challenges confronting government fiscal projections and budget implementation efforts.

Despite the widespread weakness in oil revenue collections, a number of petroleum-related income streams outperformed expectations and offered some support to government earnings.

Concessional Rentals generated N32.72 billion, exceeding the projected N15.07 billion for the period.

Miscellaneous Oil Revenue contributed N39.38 billion, surpassing its budget target of N15.02 billion.

Gas Flared Penalties generated N448.86 billion despite the absence of any budget projection for the review period.

Exchange Gains also contributed N176.96 billion even though no initial budget estimate had been provided.

According to the Budget Office, the poor overall revenue performance was largely attributable to lower-than-expected crude oil production and weaker international crude oil prices.

The report stated that operational disruptions, infrastructure deficiencies, inadequate investment in upstream oil activities and persistent crude oil theft continued to undermine production levels across the sector.

In addition, softer global oil prices reduced export earnings and further weakened government revenue generation during the period under review.

Nigeria has continued to intensify efforts aimed at improving the performance of the oil sector and reducing the country’s long-standing dependence on crude oil revenues.

The Federal Government is implementing a range of measures designed to boost crude oil production and combat oil theft, which remains a major challenge to the industry.

Authorities are also banking on ongoing reforms in the oil and gas sector to improve operational efficiency, strengthen investor confidence and attract fresh investments into the industry.