Nigeria’s Oil Rig Count Jumps 20% as Upstream Activity Rebounds

Rig count rises to 18 in July as crude production climbs 6.8% in second quarter
Nigeria’s oil rig count rose by 20 percent in the first seven months of 2026, signalling a recovery in drilling activity and crude production, according to data from the Organization of the Petroleum Exporting Countries (OPEC).
Africa’s largest crude producer increased its number of active rigs to 18 in July from 15 in January. The addition of three rigs represents a gradual recovery in upstream activity after a sluggish 2025, when Nigeria averaged just 13 active rigs.
Rig counts are closely monitored across the oil industry as a leading indicator of upstream activity. A rising rig count suggests that operators are committing fresh capital to future production rather than simply maintaining existing wells.
Each active rig also generates demand across the oilfield supply chain, creating business opportunities for drilling contractors, completion crews and oilfield service companies.
Data from OPEC’s latest Monthly Oil Market Report showed that Nigeria’s crude production averaged 1.45 million barrels per day in the first quarter of 2026 before rising to 1.55 million barrels per day in the second quarter, representing a 6.8 percent increase.
Production peaked at 1.583 million barrels per day in June before falling to 1.546 million barrels per day in July, a month-on-month decline of about 37,000 barrels per day.
Despite the decline, July production remained above Nigeria’s 2025 average of 1.510 million barrels per day, exceeding last year’s average by roughly 36,000 barrels per day.
“Nigeria’s near-term outlook remains positive, supported by oil production, progress on reforms, infrastructure investment, and stronger business activity,” OPEC said in its report.
The simultaneous increase in rig activity and crude output is significant for Nigeria, where years of underinvestment, pipeline vandalism and crude theft have disrupted production and discouraged new drilling commitments from international and domestic operators.
Aisha Mohammed, an energy analyst at the Lagos-based Center for Development Studies, said July marked the third consecutive month in which Nigeria’s production remained above the 1.5 million barrels-per-day OPEC quota.
She attributed the four percent decline from June to operational problems at the Erha and Akpo fields but noted that Nigeria still remained above the ceiling.
“After years of consistently missing the target, this stretch of compliance is meaningful. More barrels mean more dollars into FAAC and a stronger case for a higher quota later. Progress is real, even if the road to 2 million barrels remains long,” she said.
Nigeria’s rig count averaged 13 in 2025, down from 15 in 2024 and 14 in 2023, reflecting a prolonged decline in drilling investment in the country’s oil industry.
The recovery in 2026, however, has not been a steady month-by-month increase. OPEC’s monthly figures show that the rig count remained at 16 through the first and second quarters before rising to 18 in June and maintaining that level in July.
The pattern suggests that much of the renewed drilling activity was concentrated around the middle of the year rather than building gradually throughout the period.
The increase comes as the Federal Government and industry operators intensify efforts to raise crude production, which remains crucial to Nigeria’s export earnings, government revenue and foreign-exchange inflows.
OPEC said Nigeria’s broader economic outlook remains supported by its oil performance, with higher crude production helping to strengthen fiscal revenues, foreign-exchange inflows and external buffers.
The July decline in production was linked to specific field-level challenges rather than a broad slowdown across the industry.
The Nigerian Upstream Petroleum Regulatory Commission attributed the month-on-month decline to operational challenges at the Erha and Akpo fields.
Despite the setbacks, production across most other producing assets remained relatively stable, with operators implementing measures aimed at maintaining production efficiency and limiting the impact of operational constraints, NUPRC said.
With the rig count now at an 18-month high and crude production remaining above the 2025 average, the latest figures point to a strengthening upstream sector, although sustained investment and improved operational stability will be critical if Nigeria is to move closer to its long-term ambition of producing 2 million barrels per day