Ghana’s oil revenue story is taking a troubling turn as new figures from the Public Interest and Accountability Committee (PIAC) show that the country’s petroleum earnings dropped sharply from $1.3 billion in 2024 to $770 million in 2025.
This steep decline represents about 41% drop. For a country that has long relied on oil as a key source of funding for budgets and critical infrastructure projections, the persistent situation raises urgent questions about sustainability.
According to the latest Annual Report launched by PIAC for 2025, the sharp decline was mainly driven by declining oil production, a situation PIAC has consistently sounded the alarm over.
A Sharp Drop in Just One Year
The fall from $1.3 billion to $770 million is not just on paper; it represents hundreds of millions of dollars lost in revenue that would have otherwise supported government spending.
To put it into perspective, Ghana earned as much as $1.4 billion at its peak in 2022. The current figure of $770 million signals a steady downward slide, bringing revenues closer to historical lows if the situation is not urgently addressed.
Declining Production at the Core
At the heart of this decline is a persistent drop in oil production. As has been earlier warned by PIAC, the output from Ghana’s oil fields continues to weaken due to aging infrastructure, reduced investment, and natural field decline.
With the natural decline, the shrinking of revenues is inevitable. Simply put, when less oil is produced, less is sold, and government earnings fall. PIAC therefore expressed concern over the lack of investments in Ghana’s oil fields since 2018, a situation that has contributed to the current menace.
Another factor identified by PIAC is legal battles. The legal battles engaged in by some partners are also taking a toll on the country’s oil production.
If this trend is not reversed, the country could be entering a prolonged period of declining oil income.
Breakdown of 2025 Oil Revenues
The composition of the $770 million revenue also tells an important story:
Corporate Income Tax (CIT): $346 million
Carried and Participating Interest (CAPI): $339.3 million
Royalties: $77.6 million
Others: $6.5 million
For the first time in years, corporate income tax has overtaken carried and participating interest as the largest contributor.
A Shift in Revenue Dynamics
According to PIAC, this shift is significant. It suggests that oil companies operating in Ghana may have exhausted their capital allowances and are now paying more taxes on profits.
While this boosts tax revenue in the short term, it may also signal that fewer new investments are being made in the sector.
In 2024, carried and participating interest alone exceeded $600 million, far higher than 2025 levels. The drop highlights how much income Ghana is losing from direct participation in oil production.
What This Means for the Economy
Oil money supports critical areas such as infrastructure, education, and energy projects. When revenues fall, the government faces tougher choices such as cutting spending, increasing borrowing, or introducing new taxes.
In a time when the economy is still stabilizing, such revenue losses could strain public finances even further.
This means that if production continues to decline and new investments are not attracted into the sector, Ghana’s oil revenue could shrink even further in the coming years. What was once seen as a reliable financial cushion may gradually lose its strength.
Without urgent intervention, whether through new exploration, improved efficiency, or policy reforms, the country risks watching one of its most important revenue streams slowly dry up.
