Nigeria’s Oil and Gas Sector Sees Surge in Foreign Capital Inflows, But Still Lags Behind
Nigeria’s oil and gas sector has witnessed a significant increase in foreign capital inflows, with a 283.3 per cent rise in the first quarter of 2026 compared to the same period in 2025. However, despite this growth, the industry continues to receive only a negligible share of total investments entering the country, according to official data.
The latest figures from the National Bureau of Statistics (NBS) show that the oil and gas sector attracted $460,000 in foreign capital during the first quarter of 2026, up from $120,000 in the corresponding period of 2025. While this represents a substantial percentage increase, the actual value of these investments remains extremely low when compared to the overall capital imported into the Nigerian economy.
Total capital importation into Nigeria rose to $10.37 billion in the first quarter of 2026, up from $5.64 billion in the same period of 2025, reflecting an 83.83 per cent increase. The oil and gas sector’s inflow of $460,000 accounted for virtually zero per cent of the total capital imported during the quarter, highlighting the continued reluctance of investors toward an industry that remains the backbone of Nigeria’s economy.
Key Sectors Benefiting from Foreign Investments
In contrast to the oil and gas sector, other industries saw more substantial inflows of foreign capital. The financial services industry emerged as the largest beneficiary, with the banking sector attracting $7.55 billion, or 72.79 per cent of total capital imported into Nigeria in the first quarter. The financing sector followed with $2.43 billion, or 23.42 per cent of total inflows.
The production and manufacturing sector also saw some investment, receiving $152.27 million, which accounted for 1.47 per cent of total capital imported into the country.
Portfolio investments dominated the flow of foreign capital, accounting for $9.86 billion, or 95.09 per cent of total investments recorded during the quarter. Other investments contributed $374.48 million, representing 3.61 per cent, while foreign direct investment (FDI), often considered the most stable form of capital, stood at just $135.08 million, or 1.30 per cent of total inflows.
Major Sources of Foreign Capital
The United Kingdom remained Nigeria’s largest source of foreign capital, contributing $5.08 billion, or 49.01 per cent of total inflows. The United States followed with $3.18 billion, or 30.69 per cent, while South Africa contributed $983.83 million, or 9.49 per cent of the total capital imported during the quarter.
Standard Chartered Bank Nigeria Limited handled the largest share of capital inflows into the country, receiving $4.41 billion, or 42.56 per cent of total imported capital. Stanbic IBTC Bank Plc followed with $2.78 billion, or 26.79 per cent, while Rand Merchant Bank received $930.82 million, or 8.97 per cent of the total.
Government Reforms and Investor Confidence
Despite the government’s repeated assurances that Nigeria’s oil and gas sector is experiencing a major investment rebound due to reforms under the Petroleum Industry Act, the latest data suggests that foreign capital inflows remain weak relative to the sector’s strategic importance.
At the 2026 Nigeria International Energy Summit in Abuja, the Minister of State for Petroleum Resources, Heineken Lokpobiri, highlighted that Nigeria secured 28 new Field Development Plans valued at $18.2 billion in 2025. These projects are expected to unlock about 1.4 billion barrels of crude oil reserves, signaling renewed investor confidence in the upstream sector.
Lokpobiri also noted that four of the seven major Final Investment Decisions announced across Africa between 2024 and 2025 were recorded in Nigeria, which he attributed to policy clarity, improved governance, and reforms aimed at making the country’s petroleum industry more competitive.
Similarly, the Group Chief Executive Officer of NNPC Limited, Bashir Bayo Ojulari, stated that reforms championed by the Nigerian Upstream Petroleum Regulatory Commission had unlocked more than $24 billion in investments across the upstream oil and gas industry, with an additional $10 billion in the pipeline.
Discrepancy Between Promises and Reality
However, the NBS data paints a different picture regarding actual foreign capital imported into the sector during the first quarter of 2026. Despite the government’s announcements of multi-billion-dollar commitments and project approvals, the oil and gas industry attracted only $460,000 in capital importation during the period, accounting for virtually zero per cent of the $10.37 billion that entered the Nigerian economy.
This discrepancy highlights the gap between investment commitments and the actual inflows, raising concerns about the pace of recovery in an industry that generates the bulk of Nigeria’s foreign exchange earnings and government revenues.
