Nigeria's total expenditure in the third quarter of 2025 fell by 41.57% below its prorated quarterly budget target, amounting to N8.03 trillion. This figure, however, was N0.39 trillion, or 4.86%, higher than the N7.64 trillion recorded in the same period of 2024.
The Budget Office of the Federation's report indicated a fiscal deficit of N0.33 trillion for the quarter. The total expenditure represented a N5.71 trillion decrease from the N13.75 trillion prorated quarterly budget for the period.
Non-debt recurrent expenditure in Q3 2025 was N2.66 trillion, a decrease of N739.01 billion (21.75%) from the quarterly estimate of N3.40 trillion. This was an increase of N0.83 trillion (31.20%) from the N1.83 trillion recorded in Q3 2024.
The deficit-to-GDP ratio for the quarter was 2.29%, which remains within the 3% threshold for Nigeria and the ECOWAS convergence criteria. Statutory transfers amounted to N360.32 billion during the review period.
Oil Revenue Shortfall and Borrowing Trends
Nigeria's oil revenue performance in Q3 2025 significantly missed budget expectations, with gross oil revenue at N4.87 trillion. This represents a shortfall of N7.88 trillion, or 61.8%, below the quarterly budget projection of N12.76 trillion.
Despite this shortfall, oil revenue saw a slight increase from N4.77 trillion in Q2 2025 and N4.62 trillion in Q3 2024. The Budget Office noted a 2.1% quarter-on-quarter increase and a 5.41% year-on-year growth in actual oil revenue.
Key revenue lines within oil revenue showed substantial deficits. Crude Oil and Gas Sales generated N622.99 billion against a projected N1.18 trillion, a 47.12% shortfall. Petroleum Profit Tax and Gas Taxes yielded N1.97 trillion against a projected N7.85 trillion, a deficit of N5.87 trillion or 74.82%.
In the first nine months of 2025, the Federal Government recorded N11.89 trillion in fresh borrowings, exceeding the N10.34 trillion projected for the period by N1.54 trillion (14.91%). Domestic borrowing accounted for N7.08 trillion, while multilateral and bilateral project-tied loans amounted to N4.81 trillion.
Capital expenditure, however, lagged significantly, with only N3.10 trillion spent against a budgeted N17.58 trillion for the nine-month period, representing 17.66% of the budget and a shortfall of N14.48 trillion (82.34%).
Multilateral and bilateral project-tied loans saw N4.81 trillion borrowed against a three-quarter target of N2.52 trillion, an excess of N2.28 trillion (90.54%). Conversely, capital expenditure under this category recorded zero spending despite a N2.52 trillion budget provision.
Overall economic indicators show improved GDP growth, with an average of 3.19% in 2024 and 3.85% in 2025. External reserves rose to approximately $49.26 billion by May 25, 2026. Nigeria's tax-to-GDP ratio also increased to 13.5% following tax reforms.
