CSL Stockbrokers have projected that Nigeria’s Current Account Surplus will plunge in 2025 amid oil price slump.
NewsOnline Nigeria reports that Nigeria’s current account surplus is projected to nosedive in 2025, dropping to just 2.7% of GDP from 9.2% in 2024, according to the latest Economic Outlook Report released by CSL Stockbrokers Limited, a subsidiary of FCMB Group Plc.
The sharp decline is attributed to weakening global crude oil prices, persistent deficits in the services and primary income accounts, and a trade balance under mounting pressure.
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CSL analysts noted that while initial fears from the Israel-Iran conflict temporarily lifted oil price expectations, those geopolitical tensions have since eased. As a result, oil prices are now forecast to average between $60 and $70 per barrel for the remainder of the year.
Oil exports, which constituted 86% of Nigeria’s total exports in 2024, are expected to fall by 20% year-on-year to $36.4 billion, after oil prices in the first half of 2025 came in 15% lower than the same period last year. Although Nigeria’s import bill is projected to decline slightly, particularly due to reduced fuel imports from increased local production at the Dangote Refinery, the drop in imports may not be sufficient to offset the much steeper decline in export earnings. CSL warned that the goods trade balance will likely remain constrained under these conditions.
Compounding the pressure, the services and income accounts are projected to widen their deficits. The services account, which has averaged a $13.7 billion deficit annually over the past five years, is expected to remain firmly negative, driven largely by outbound travel and transportation costs. The primary income account is also set to deteriorate, due to an uptick in profit repatriation by foreign investors and multinational oil companies. Foreign investor participation in Nigeria’s equity markets rose sharply to 29% as of May 2025, up from 20% a year earlier, potentially increasing capital outflows further.
In contrast, remittance inflows, classified under secondary income are expected to rise to $25.3 billion in 2025, from $23.8 billion in 2024, providing some support to the external balance. However, this segment faces a new threat, as a proposed U.S. bill seeks to introduce a 5% tax on outbound remittances, a move CSL warns could undermine government efforts to attract $1 billion in monthly inflows from the diaspora.
The report emphasized that Nigeria’s external balance remains highly sensitive to oil prices and production levels. In a downside scenario where oil prices fall below $55 per barrel and production stays around 1.22 million barrels per day, the current account could swing into a deficit of 0.3% of GDP. Conversely, if oil prices recover to an average of $70, Nigeria could claw back 1 to 2 percentage points on the surplus, restoring some measure of stability.
Meanwhile, NewsOnline Nigeria reports that the World Bank has offered a more optimistic long-term projection, estimating that Nigeria’s current account surplus could rise slightly to 9.4% of GDP by 2026, driven by reduced imports and strong remittance flows fueled by the naira’s depreciation. Nonetheless, for 2025, CSL’s outlook warns of tightening external buffers and a fragile balance of payments environment that may test the resilience of Africa’s largest economy.
