Fuel Crisis Looms As Dangote Refinery Set To Stop Supplying Nigerian Market

Dangote Refinery is set to suspend the supply of petroleum products to the Nigerian market following stalled negotiations over the naira-for-crude agreement.

However, sources familiar with the matter told TheCable that the refinery will continue loading products for export, as it currently procures all its crude oil in dollars from the international market.

Previously, the refinery sold fuel to Nigerian marketers in naira, leveraging a crude supply deal with the Nigerian National Petroleum Company (NNPC) Ltd., which allowed it to purchase crude in local currency.

With the agreement now concluded and no new terms in place, the refinery’s supply to the domestic market will be put on hold.

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The latest developments have sparked concerns about fuel availability and potential price increases in Nigeria’s domestic market.

Earlier reports suggested that the Nigerian National Petroleum Company (NNPC) had ended its crude supply agreement with Dangote Refinery and other local refineries.

However, company officials later clarified that the existing deal, which commenced in October 2024, remains in effect but is set to expire by the end of March 2025.

NNPC’s Chief Corporate Communications Officer, Olufemi Soneye, confirmed that discussions are underway for a new agreement.

“NNPC has made over 48 million barrels of crude oil available to Dangote Refinery since October 2024,” he stated, further revealing that the refinery has received more than 84 million barrels in total since its launch in 2023.

The naira-for-crude arrangement was initially introduced to ensure fuel supply stability, reduce dependence on dollar-based imports, and help manage pump prices.

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With the deal now approaching its end, industry experts warn that fuel prices could rise, especially if Dangote Refinery prioritises exports over domestic distribution.