With just one game remaining and only the group winners to qualify, Nigeria cannot make up their five-point deficit to table-toppers Egypt.
It was a match that the Eagles needed an outright win as their host with four points in their kitty had a two point advantage before the encounter. Egypt now have an unassailable seven points with one match to play in June.
Nigeria have a distant two points and even if they trounce Tanzania in September, they will not be at Gabon 2017.
Despite their galaxy of foreign stars, Nigeria never really stretched the Egypt backline except in the 84th minute, when Victor Moses shot from outside the box came off the post with the Egypt goalkeeper well beaten. Hosts Egypt created the better chances in the first half but Nigeria also had their moments during a goalless first half at a packed Borg El-Arab Stadium in Alexandria.
Nigeria played with a lot of confidence and dictated the tempo of the game for a good period of the first 45 minutes.
Egypt created two early openings – Hegazy headed narrowly past the Nigeria goal after five minutes and almost immediately skipper Al-Said fired with a left foot from inside the box.
Al-Said then delivered a low cross from the left in the 29th minute, but Mohamed Salah was not close to make contact.
In the closing minutes of the first half, Nigeria goalkeeper Akpeyi pulled off two big saves from Ibrahim Salah and again skipper Al-Said.
In the seventh minute, Umar Aminu dashed into the Egyptian goal area but his shot was firmly held by the goalkeeper.
Odion Ighalo had a half chance when he controlled the ball inside the box, but he shot wide in the 15th minute.
In the 86minute, Iwobi, whose inclusion brought life into the Eagles attack, set up Ighalo inside the box, but somehow the Egyptians survived this onslaught as his shot flew off a defender who threw himself in the line. That was Nigeria’s last effort before the final whistle.