Nigeria's recession deepens in Q3 as oil production falls

Nigeria’s recession has deepened in the third quarter, and oil production fallen, the National Bureau of Statistics (NBS) has said.

A slump in crude oil prices caused the west African nation’s economy to shrink by 2.06 percent in the second quarter, plunging the country into its first recession in 25 years.

Gross Domestic Product (GDP) according to the NBS also contracted by 2.24 percent in the third quarter compared to a year ago.

Oil production fell to 1.63 million barrels per day in the third quarter, from the 1.69 million recorded in the second quarter.

The non-oil sector on the other hand, grew by 0.03 percent in the third quarter, compared with negative growth in the first two quarters.

Nigeria’s recession has been deepened by a series of attacks by militants on oil and gas facilities in the Niger Delta since January leading to a drop in oil production.

Inflation hit a more than 11-year high of 18.3 percent in October as prices of goods and services have been pushed up by a dollar shortage.

Nigeria practically imports everything it needs thus making the dollar shortage more pronounced as businesses are now unable to import machine parts for instance.

An analyst with international ratings agency Moody’s has however told the Reuters news agency that Nigeria’s economy could expand by 2.5 percent next year if the country can keep oil output at the 2.2 million barrels per day as set by the government in the 2016 budget.

Nigeria’s oil minister Emmanuel Kachikwu had said in September that production was recovering and had reached around 2 million barrels after months of attacks on oil installations by the Niger Delta Avengers.