Nigeria’s GDP Expands 4.23% in Q2 2025, Boosted by Oil and Industry

Nigeria’s economy recorded a significant boost in the second quarter of 2025, with Gross Domestic Product (GDP) growing by 4.23% year-on-year, according to new figures released by the National Bureau of Statistics (NBS). This marks a faster pace than the 3.48% growth recorded in Q2 2024 and represents one of the strongest quarterly performances in recent years.

The improvement was driven by increased crude oil production, robust performance in the mining sector, and continued resilience in non-oil activities. Nominal GDP stood at ₦100.73 trillion, a 19.23% rise compared to ₦84.48 trillion recorded in the same period last year, underscoring both real growth and inflationary trends in the economy.

Economists say the latest data reflects an economy gradually recovering from the combined impact of subsidy removal, exchange rate volatility, and sluggish growth in previous quarters. With key sectors showing renewed momentum, there are hopes that the second half of the year could consolidate these gains.

Oil and Industry Lead Growth

The oil sector delivered one of its strongest contributions in several quarters, supported by improved output and fewer disruptions to production. Average daily crude oil production climbed to 1.68 million barrels per day, compared to 1.41 million barrels per day in the corresponding quarter of 2024. This pushed oil GDP growth to 20.46%, accounting for 4.05% of overall GDP.

Industry as a whole grew by 7.45%, compared to 3.72% in Q2 2024. Mining and quarrying, a major component of industry, surged 20.86% year-on-year, supported by strong gains in coal mining and other extractive activities. The manufacturing sector also contributed positively, though growth was more modest, reflecting the impact of high production costs and exchange rate pressures on local manufacturers.

Non-Oil Sector Shows Steady Resilience

The non-oil sector, which has been the backbone of Nigeria’s economy for over a decade, grew by 3.64% during the quarter. The expansion was driven by agriculture, telecommunications, real estate, finance, and construction. Agriculture, which remains a major employer, grew 2.82%, slightly higher than the 2.60% recorded in the same quarter of 2024. Services, which account for a large share of GDP, recorded 3.94% growth, supported by gains in trade, ICT, and financial services.

However, the contribution of the non-oil sector to overall GDP dipped slightly to 95.95% from 96.49% in Q2 2024, as oil made a stronger comeback. Analysts believe this rebalancing is healthy in the short term, provided oil revenues are effectively used to support infrastructure investment and non-oil development.

The NBS report noted that the performance reflects Nigeria’s “gradual but consistent” recovery path, with stronger oil output and improved industrial activity helping to offset macroeconomic headwinds. Nevertheless, challenges remain, including persistent inflation, currency volatility, and high borrowing costs that could weigh on consumer demand and private investment in subsequent quarters.

Looking ahead, experts expect the momentum to continue into Q3 2025 if oil production remains stable and government reforms succeed in boosting investor confidence. They also caution that sustaining growth will require deeper structural reforms, particularly in energy supply, logistics, and credit markets, to enable small and medium enterprises to thrive.