Nigerian indigenous oil producers are accelerating investments in near-term extraction projects as rising global crude oil prices triggered by the Middle East conflict boost revenues and strengthen efforts to increase the country’s oil production.
According to reports, several local upstream operators are reinvesting gains from the ongoing Iran-related oil market disruption into drilling campaigns and expansion projects aimed at raising output before the end of the year.
The move comes amid tightening global crude supply linked to disruptions around the Strait of Hormuz, a critical international oil and gas shipping route, which has pushed oil prices upward in recent weeks.
Industry players say the current market conditions present a major opportunity for Nigerian producers to expand output and increase market share amid growing supply concerns.
Wisdom Enang, a former manager at Exxon Mobil Corp. in Nigeria, described the situation as a strong opportunity for long-term planning and investment.
According to him, output from Nigeria’s smaller producers could rise by between 200,000 and 300,000 barrels per day before the end of 2026.
Chief Executive Officer of Oando Energy Resources, Wale Tinubu, said the company plans to increase production by 30 per cent to about 42,500 barrels per day by the end of the year through the drilling of additional wells.
Tinubu added that the company is also bringing forward a five-year strategy aimed at doubling production in order to take advantage of supply gaps created by the ongoing conflict.
Industry executives noted that higher crude prices are improving the commercial viability of new drilling campaigns while also attracting stronger investor interest in Nigeria’s oil sector.
Nigeria’s oil production has been recovering gradually after years of underinvestment, crude theft, pipeline vandalism, and operational disruptions that weakened output across the Niger Delta.
The Nigerian Upstream Petroleum Regulatory Commission reported that the country recorded a combined daily average output of 1.663 million barrels per day of crude oil and condensates in April 2026.
President Bola Ahmed Tinubu’s administration has introduced reforms aimed at improving investment conditions in the petroleum sector, including tax incentives, streamlined contract approvals, and restructuring within Nigerian National Petroleum Company Limited.
Indigenous companies have also expanded their presence in the upstream sector following the acquisition of onshore and shallow-water assets divested by international oil companies in recent years.
Oando Energy Resources significantly expanded its upstream portfolio after acquiring assets from Eni SpA in 2024.
Several local producers are already accelerating drilling activities in response to improved cash flow from stronger oil prices.
Petralon Energy said it has moved forward with plans for a third well after crude prices rose above its internal benchmark of $65 per barrel.
The company’s Chief Executive Officer, Ahonsi Unuigbe, said production is expected to rise by 56 per cent to about 7,500 barrels per day before the end of 2026.
Pan Ocean Oil Corp. and Newcross Companies, which jointly produce about 48,000 barrels per day, also disclosed that they have reactivated two oil wells since the conflict began.
Finance Director of the joint operation, Oluseyi Oladapo, said the impact of the conflict on revenues had been “materially positive.”
Executives further disclosed that rising oil prices are attracting growing interest from Middle Eastern investors seeking opportunities in Nigeria’s upstream petroleum sector.
The NUPRC recently disclosed that Nigeria supplied 28.5 million barrels of crude oil to domestic refineries in the first quarter of 2026.
According to data from the Organization of the Petroleum Exporting Countries, Nigeria’s crude oil production stood at 1.459 million barrels per day in January 2026 before declining to about 1.31 million barrels per day in February and later recovering to 1.38 million barrels per day in March.
Nigeria remains Africa’s largest crude oil producer and is targeting a significant increase in output over the next four years as part of broader economic and fiscal reforms by the Federal Government.
