Libya dethrones Nigeria as largest oil producer in Africa

Africa’s oil production landscape is experiencing a shift, according to data from the Organization of the Petroleum Exporting Countries (OPEC). The April 2024 Monthly Oil Market Report (MOMR) reveals that Libya overtook Nigeria as the top producer in March 2024.

Libya’s crude oil production climbed to 1.236 million barrels per day (bpd) in March, compared to 1.173 million bpd in February. This increase signifies a notable change in the regional production dynamic. While Nigeria maintained its lead in cumulative production for the period between March 2023 and March 2024, its daily output dipped in March. Production figures show Nigeria produced 1.23 million bpd in March, down from 1.32 million bpd in February.

With Libya emerging as a major oil producer, the continent’s overall dependence on any single oil-producing nation lessens. Recently, Niger signed a $400 million memorandum of understanding with China National Petroleum Corp (CNPC), a state-owned oil behemoth, tied to the sale of crude oil from its Agadem oilfield. While the reasons behind Libya’s rise require further analysis, they could be attributed to factors like improved security conditions within the country, which facilitate increased oil production activities.  Investments in oil infrastructure could also be a contributing factor.  On the other hand, Nigeria’s decline might be due to technical challenges at oil fields or ongoing unrest in oil-producing regions disrupting operations.

Meanwhile, the global oil market remains susceptible to price fluctuations. A sharp decline in oil prices could still impact Libya and other African oil producers. However, this news of Libya’s rise in oil production coincides with a positive economic outlook for Africa. A recent report by the African Development Bank (AfDB), titled “Macroeconomic Performance and Outlook” (MEO), paints a promising picture for the continent. The report predicts several African countries will be among the world’s fastest-growing economies. These developments also signal breathing room for other African countries to invest in and develop other sectors of their economies.  While oil production remains an important contributor to African economies, the continent’s long-term growth hinges on diversification. AfDB highlights the potential of other sectors like agriculture, manufacturing, and technology to drive sustainable economic expansion.