The Federal Government, through the Nigerian National Petroleum Company Limited (NNPC), has initiated steps to source crude oil for the Dangote Petroleum Refinery from international third-party traders, aiming to sustain domestic refining operations, The PUNCH reports.
Officials caution, however, that the intervention may not immediately translate into lower petrol prices for consumers. Nigerians are grappling with rising fuel costs following recent hikes linked to the $20 billion Lekki-based refinery, which temporarily suspended Premium Motor Spirit (PMS) loading. This marks the second such halt within a week, fuelling speculation of another price surge.
Gantry prices have jumped from N774 to N995 per litre, with retail pumps in several states now dispensing petrol at N1,200 per litre, exacerbating economic pressures.
Rising Imports and Global Pressures
Market data from Kpler analytics indicates Nigeria’s crude imports from the United States surged to 41.13 million barrels in 2025, a 161% increase from 15.79 million barrels in 2024. Analysts attribute the shift to logistical challenges and global volatility, including the Iran-US conflict and tensions around the Strait of Hormuz, which have pushed Brent crude above $92 per barrel.
A senior NNPC official, speaking on condition of anonymity, said: “Leveraging our global crude trading network, we are sourcing third-party crude for the refinery at prices competitive with international rates. NNPC remains committed to supporting domestic refining despite temporary availability constraints.”
The Dangote Refinery noted that while imported crude helps maintain production, global energy price pressures and limited domestic allocations—only five cargoes a month instead of the 13 required under the naira-for-crude policy—continue to affect pump prices.
Industry Insights
Industry stakeholders say increased domestic refining could help moderate costs. Eche Idoko, National Publicity Secretary of the Crude Oil Refinery Owners Association of Nigeria, emphasized that full implementation of the naira-for-crude policy could impact local pricing, but reliance on US imports and supply chain challenges will still pass costs to consumers.
Jeremiah Olatide, CEO of Petroleumprice.ng, highlighted that restricted import licenses—denying nearly 90% of applicants—have strengthened the Dangote refinery’s market influence. He stressed the need for a balance between local refining and controlled imports to enhance energy security and stabilize prices.
Dangote’s Role in Cushioning the Market
Despite supply pressures, the Dangote refinery has mitigated sharper price spikes, with analysts noting that petrol prices could have reached N1,500 per litre without domestic refining capacity.
To ensure continued distribution, Dangote has expanded its list of petroleum marketers and partners from 13 to over 30 companies nationwide, including NIPCO Plc, MRS Oil Nigeria Plc, TotalEnergies Marketing Nigeria Plc, and Conoil Plc.
With petrol now retailing between N1,030 and N1,100 per litre in major cities, consumers and transport operators brace for continued cost pressures, underscoring the complex interplay of domestic refining capacity, international supply challenges, and government policy in Nigeria’s energy market.
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