Nigeria’s Naira-for-Crude Deal Set to Commence Tuesday, Fuel Price Reduction Anticipated

The Nigerian government has confirmed that the Nigerian National Petroleum Company Limited (NNPC) will begin supplying crude oil to the Dangote Refinery in exchange for naira starting Tuesday, October 1, 2024.

According to Dare Adekanmbi, spokesperson to the Chairman of the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency, Zacch Adedeji, the committee is working tirelessly to ensure the agreement’s successful implementation. The Federal Executive Council, led by President Bola Tinubu, approved the sale of crude to local refineries in naira and the corresponding purchase of petroleum products in naira.

The NNPC will supply approximately 385,000 barrels of crude oil per day to the Dangote Refinery, translating to around 11.5 million barrels monthly. In return, the refinery will release equivalent volumes of refined diesel and petrol to the domestic market, also valued in naira.

However, Eche Idoko, Publicity Secretary of the Crude Oil Refinery-owners Association of Nigeria, emphasized that the Naira-for-crude deal should be extended to other modular refineries, not just Dangote Refinery.

Petroleum marketers predict that selling crude oil to Dangote Refinery and other refineries in naira will lead to a decrease in petrol prices. Currently, Nigerians pay between N950 and N1,100 per liter nationwide, following NNPC’s announcement of fresh prices after the lifting of Dangote Petrol on September 15, 2024.