Nigeria’s statutory revenue allocation fell N20.74tn short of its budget target in the first 10 months of 2026, despite a sharp increase in crude oil prices triggered by the United States-Iran war, raising questions about the extent to which the country has converted the global oil market rally into stronger government revenue.
Figures from the Federation Account income distribution report of the Office of the Accountant-General of the Federation, analysed by The PUNCH, showed that statutory revenue stood at N26.14tn between January and October, against a budget projection of N46.87tn for the period.
The records were presented in documents associated with the Federation Account Allocation Committee’s September meeting, held at the Federal Ministry of Finance headquarters, Abuja, to consider the August 2026 accounts.
The technical sub-committee’s report, dated 14 October, was obtained by The PUNCH on Monday.
The shortfall represented 44.24 per cent of the total budgeted amount.
The figures showed that the government consistently missed its monthly statutory revenue targets, even as receipts improved significantly between May and August, following the escalation of the Middle East conflict and the resulting disruption to global oil supplies.
The war began on 28 February, 2026, when the United States and Israel launched strikes against Iran.
The conflict disrupted shipping through the Strait of Hormuz, a major route for global oil and gas supplies, and sent crude prices sharply higher.
Although the parties reached ceasefire arrangements and attempted negotiations, the agreements subsequently broke down, with hostilities resuming and uncertainty persisting into the second half of the year.
The International Energy Agency and other market observers have identified disruptions to oil shipments through the Strait of Hormuz as a major source of pressure on global energy prices.
Nigeria, as a crude oil producer, was expected to benefit from higher international prices through increased export earnings and government oil receipts.
The nation’s flagship crude oil grade, Bonny Light, rose by about 76.75 per cent from an average of $70.14 per barrel before the United States-Iran war to $123.97 per barrel in a dated price quote for 22 October, 2026, highlighting the potential for increased oil earnings amid the Middle East crisis.
The 22 October quote of $123.97 per barrel was also $59.12, or 91.16 per cent, above the Federal Government’s 2026 budget benchmark of $64.85 per barrel. This means that the price of Nigeria’s flagship crude grade was almost twice the level assumed in the budget, potentially strengthening export earnings from every barrel sold at the higher price.
However, a 24 October report quoted Bonny Light at about $115 per barrel. At that price, the grade would have risen by $44.86, or 63.96 per cent, from the pre-war average of $70.14.
However, the Accountant-General’s figures suggest that the higher prices have not translated into statutory revenue sufficient to meet the monthly budget targets.
The report showed that the monthly budget benchmark remained unchanged at N4.687tn throughout the 10 months, while actual receipts fluctuated considerably.
In January, statutory revenue stood at N1.63tn, leaving a shortfall of N3.06tn, or 65.19 per cent below the monthly target.
Revenue improved to N1.96tn in February, an increase of N325.35bn, or 19.94 per cent, from January. Nevertheless, the February figure was N2.73tn below budget, representing a 58.25 per cent shortfall.
The improvement was reversed in March, when statutory revenue fell to N1.56tn from N1.96tn in February. The decline of N395.14bn represented a 20.19 per cent month-on-month drop.
March recorded the weakest revenue performance of the first quarter, with receipts missing the monthly budget by N3.13tn, or 66.68 per cent.
Revenue recovered in April to N1.70tn, an increase of N137.91bn, or 8.83 per cent, from March. However, the figure remained N2.99tn below the target, representing a 63.74 per cent deficit.
The upward movement gathered pace in May, when statutory revenue rose to N2.38tn from N1.70tn in April. The increase of N678.22bn represented a 39.90 per cent month-on-month improvement.
Despite the rebound, May’s receipts were still N2.31tn below the monthly budget, equivalent to a 49.27 per cent shortfall.
In June, revenue increased further to N2.65tn, up by N273.62bn, or 11.51 per cent, from May. The figure nevertheless fell N2.04tn short of the target, representing a 43.43 per cent deficit.
The greatest monthly improvement occurred in July, when actual statutory revenue, including a N250bn augmentation, reached N3.95tn.
The July figure represented an increase of N1.30tn, or 48.99 per cent, from June’s N2.65tn. It was, however, still N736.50bn below the monthly budget, a shortfall of 15.71 per cent.
Revenue peaked in August at N4.36tn, the highest monthly figure in the period under review. This represented an increase of N408.09bn, or 10.33 per cent, from July.
August came closest to the monthly budget, missing the N4.69tn target by just N328.41bn, or 7.01 per cent.
However, the momentum weakened sharply in September, when statutory revenue fell to N2.85tn from N4.36tn in August.
The decline of N1.51tn represented a 34.61 per cent month-on-month contraction. September’s receipts were N1.84tn below the budget, equivalent to a 39.19 per cent shortfall.
Revenue recovered modestly in October, rising to N3.10tn from N2.85tn in September. The increase of N246.38bn represented an 8.64 per cent improvement.
Despite the recovery, October’s receipts remained N1.59tn below the monthly target, a deficit of 33.94 per cent.
The October figure was approximately 89.77 per cent higher than January’s N1.63tn, showing that the nominal value of monthly receipts had increased substantially over the 10-month period. Yet, the improvement was not sufficient to close the gap between actual revenue and the budget.
The data also reveal a significant difference between the first six months of the year and the period from July to October.
Between January and June, statutory revenue totalled N11.88tn. From July to October, the figure rose to N14.26tn, including July’s N250bn augmentation.
The four-month total was therefore N2.38tn higher than the receipts recorded in the first six months, despite covering a shorter period.
The stronger performance from July was consistent with the possibility of improved oil receipts during the period of elevated international prices. However, the figures alone do not establish how much of the increase came directly from the oil price rally, as statutory revenue also depends on production volumes, export receipts, exchange rates, collection efficiency and other revenue sources.
The figures further show that the revenue shortfall remained substantial even after the monthly receipts approached the budget in August. The subsequent decline in September and the incomplete recovery in October widened the gap again.
For the Federal Government and the state and local governments that depend on Federation Account allocations, the performance has implications for budget implementation, capital spending and the financing of public services.
Higher crude oil prices can improve government earnings, but the benefits depend on Nigeria’s ability to produce and export crude, collect the proceeds due to the Federation and translate the additional earnings into distributable revenue.
The report also recorded N39.91bn in shared Electronic Money Transfer Levy proceeds in January, with no further amounts shown under that column from February to October. The levy was listed separately from the statutory revenue figures used in the monthly budget comparison.
Overall, the N20.74tn shortfall indicates that the anticipated oil windfall has not been enough to bring statutory revenue in line with the budget benchmark during the first 10 months of 2026.
The figures do not mean that Nigeria earned no additional revenue from the higher oil prices. Rather, they show that the total statutory revenue recorded in the Federation Account income distribution report remained well below the amount budgeted for the period.
Last week, The Minister of Finance and Coordinating minister of the economy, Taiwo Oyedele, admitted that Nigeria’s budget projections have often been based on unrealistic expectations, resulting in actual revenue falling significantly below targets.
Speaking at Chatham House in London, Oyedele said the country had repeatedly built its budgets on optimistic revenue estimates rather than realistic assessments of its earning capacity.
“We haven’t been doing the budget right. We do projections that are sometimes based on faith and hope. You don’t run a country based on faith,” he said.