LAGOS – Despite a historic surge in the Nigerian equities market throughout 2025, the oil and gas sector has emerged as the sole major laggard, struggling with sideways trading and persistent investor caution. While the NGX All-Share Index delivered a stellar 51 percent return, its strongest in nearly two decades, the Oil & Gas Index slipped by approximately 1.5 percent, ending the year as the weakest performing sector.
The sector’s underperformance has been attributed to a combination of internal and external pressures, including delayed financial reporting and uncertain cash flows. While industrial and consumer goods stocks rallied as a hedge against inflation, energy stocks faced significant share price pressure, falling 13.2 percent in the first four months of the year. This widening gap highlights a disconnect between the broader market momentum and the specific challenges facing Nigeria’s energy producers and distributors.
However, the narrative is not one of uniform decline, as selective “winners” have managed to decouple from the broader sector weakness. Aradel Holdings emerged as a standout performer, with its shares hitting a 52-week high of N869 in October before stabilizing. The company’s robust operational growth was reflected in its nine-month revenue, which climbed 43 percent to N538.8 billion, supported by expanded production across crude, gas, and refined products.
Similarly, Seplat Energy has been lauded for its structural resilience and steady dollar-denominated revenues. By maintaining operational efficiency and improved earnings visibility, Seplat provided a necessary anchor for the index. The company’s ability to sustain dividends amid sector-wide volatility has made it a preferred choice for investors seeking stability within the energy space.
Eterna Plc also signaled a potential turnaround, returning to profitability with a first-quarter net profit of N687 million on revenue of N73.27 billion. Despite margin pressures later in the year, the company’s launch of a N21.52 billion rights issue underscores a strategic push for future growth. In contrast, mature players like TotalEnergies Marketing Nigeria remained stable but failed to excite investors, reflecting predictable cash flows without the lure of aggressive expansion.
As the market enters 2026, analysts suggest that the “paradox of plenty” in the broader exchange will require a more disciplined approach to energy investments. “Macro tailwinds include improved investment incentives, upstream licensing, and gas infrastructure development, though global oversupply and price volatility remain headwinds,” an analyst at Futureview noted. The consensus remains that 2026 will reward operational strength and growth clarity over broad sector exposure
