Concerns over fuel supply and rising pump prices deepened on Monday as the Dangote Petroleum Refinery alleged that it was receiving only a fraction of the crude oil expected under the Federal Government’s naira-for-crude initiative, while petrol prices in Abuja climbed to as high as ₦1,280 per litre.
The development comes amid a growing dispute between the Nigerian National Petroleum Company Limited (NNPC) and the Dangote Refinery over the implementation of the naira-for-crude arrangement introduced to boost local refining and reduce pressure on foreign exchange demand.
While the NNPC insisted it had supplied all crude cargoes available under the scheme, a senior official of the Dangote Group said the refinery was receiving only about four million barrels of crude oil monthly, far below the estimated 13 million barrels envisaged under the arrangement following President Bola Tinubu’s directive in 2024.
Responding to concerns over the supply shortfall, NNPC spokesman, Andy Odeh, maintained that the national oil company had fully met its obligations under the initiative.
“Under the naira-denominated crude supply arrangement, NNPC Limited has allocated 100 per cent of all available naira crude cargoes to the Dangote Petroleum Refinery in 2026. There has been no withholding on our part,” Odeh said.
He added that actual crude deliveries were influenced by factors such as crude availability, nomination timelines and the refinery’s operational schedule.
“NNPC Limited has met its 2026 supply obligations to the refinery. Our engagement with Dangote Refinery management remains constructive, and where any gaps exist, we are resolving them together as partners,” he stated.
However, a top official of the Dangote Group, who spoke on condition of anonymity, disputed the NNPC’s position, insisting that crude supply under the arrangement remained inadequate to sustain the refinery’s operations and its previous naira-denominated fuel sales.
“We are getting just four million barrels monthly,” the official said.
The source disclosed that the refinery had begun focusing more on exports of refined petroleum products to earn foreign exchange, citing the shortfall in crude supply and the influx of imported petroleum products into the domestic market.
“Since the traders have brought lots of imported products to the market, we are focusing on exports. We can’t, and we shouldn’t be fighting against the government’s policies,” the official said.
The refinery recently announced a dollar-denominated pricing template for its products, fixing the ex-depot price of petrol at $0.779 per litre, diesel at $1.087 per litre and aviation fuel at $0.942 per litre.
According to the refinery, the decision to abandon naira-denominated fuel sales was necessitated by challenges in securing sufficient crude supplies under the naira-for-crude arrangement.
Despite the shift, the Dangote official said the refinery would continue to account for every barrel of crude received under the scheme by supplying an equivalent volume of refined products in naira to the domestic market through the NNPC.
“We will account for every barrel of crude we receive against the naira payment by supplying equivalent products in naira. We will do that through the NNPC because the NNPC buys a lot from us,” the source added.
Meanwhile, the uncertainty surrounding crude supply coincided with worsening petrol scarcity in parts of the Federal Capital Territory, where several filling stations remained shut and motorists struggled to obtain fuel.
Checks at major retail outlets showed petrol selling for between ₦1,250 and ₦1,280 per litre. Some NNPC and MRS stations along the Airport Road corridor were closed, while stations dispensing fuel recorded long queues.
The situation has heightened concerns among consumers and marketers over the potential impact of the crude supply dispute and dollar-based pricing on fuel affordability and availability.
Truck traffic also increased around private petroleum depots in Lagos as marketers sought alternative supply sources amid the suspension of product loading at the Dangote Refinery and growing expectations of a fresh increase in wholesale fuel prices.
Commenting on the development, Professor Emeritus of Petroleum Economics and Principal Facilitator at the FUPRE Energy Business School, Wumi Iledare, said the refinery’s decision to price products in dollars should be viewed within the context of global petroleum market realities.
“Does this necessarily mean higher fuel prices? Not necessarily. What it does mean is that domestic fuel prices become more closely linked to international crude oil prices and the naira-dollar exchange rate,” Iledare said.
He noted that while local refining had significantly improved Nigeria’s energy security by reducing dependence on imported fuel, domestic refining alone could not completely shield the country from global market forces.
“The refinery has significantly improved the availability of petroleum products by reducing Nigeria’s dependence on imported PMS. However, domestic refining can shield Nigeria more effectively from supply shocks than from price shocks,” he said.
The latest developments have renewed concerns about the future of the naira-for-crude initiative, which was introduced to strengthen local refining, reduce foreign exchange pressures and stabilise domestic fuel supply.
Industry stakeholders say the resolution of the crude supply dispute will be critical to sustaining refinery operations, ensuring product availability and preventing further increases in fuel prices across the country.
