Falling Crude Prices Threaten Nigeria’s Budget as Experts Push Palm Oil as Economic Lifeline

Advertisements

With global crude oil prices plummeting amid trade tensions, Nigeria’s 2025 budget faces serious risks, prompting economists to urge the federal government to pivot toward palm oil production to offset revenue losses.

Nigeria’s crude oil production has dropped by 32%, falling from 2.06 million barrels per day to just 1.4 million. Meanwhile, palm oil prices are surging due to rising global demand. Brent crude currently trades at $65.90 per barrel, while palm oil fetches $167.38 per barrel—a staggering difference that presents a major opportunity for Nigeria.

Despite inflation and naira volatility, Nigeria’s leading palm oil producers, Okomu Oil Palm Company and Presco Plc, recorded their highest profits in a decade in 2024. Presco’s profits skyrocketed by 4,088.7% since 2015, while Okomu saw a 1,188.3% surge. Okomu’s revenue grew by 73%, with post-tax profits up 62%, and Presco reported a 217% jump in profits.

While Indonesia earned $28 billion from palm oil exports in 2021, Nigeria—despite making $41 billion from crude oil—spent over $500 million importing palm oil. Experts argue that prioritizing domestic palm oil production could help close the budget gap and reduce reliance on hydrocarbons.

The push aligns with regional trends, as over 70% of sub-Saharan Africa’s population depends on forests and woodlands for livelihoods, according to the UN Environment Programme. Reviving agro-industries like palm oil is not just an economic necessity but a social imperative.

For nearly three decades, UkrAgroConsult has provided expertise in agricultural markets, compiling an extensive database that powers AgriSupp —a multi-functional online platform offering real-time market intelligence on grains and oilseeds, including Black Sea and Danube trade analytics.

As Nigeria grapples with dwindling crude revenues, palm oil could emerge as the country’s next economic engine—if the government seizes the opportunity.