Abstract: This study appraised the effect of retained earnings on the operational performances of oil and gas firms in Nigeria. The study adopted the Simple Linear regression was adopted in analyzing the secondary data sourced from the financial statements and annual reports of the selected oil companies. Retained earnings are the variable that measured the independent variable while operational performance (dependent variable) was represented using Return on Asset (ROA) and Return on Equity (ROE). The study spanned a ten (10) year period, 2009- 2018. Four (4) oil companies quoted in Nigeria Stock Exchange were used as sample for the study. The study showed that retained earnings had positive and insignificant effect on both the Return on Asset and Return on Equity of oil and gas firms in Nigeria. This effect was however insignificant for all the sampled oil and gas firms with the exception of Mobil Nigeria Plc in which the retained earnings have a positive and significant effect on the Return on Equity. The paper therefore recommend that the retained earnings of firms in oil and gas companies should be enhanced to impact significantly on the values on the shareholders ROA and ROE.