The Nigerian National Petroleum Company Limited will supply crude oil in naira to the Dangote Petroleum Refinery for an initial six-month period, pending further review by the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency.
Multiple sources from the committee and Dangote refinery confirmed on Tuesday that the naira-for-crude deal will last for an initial six months
This arrangement is in place because crude oil is an international commodity typically priced in dollars.
Bloomberg reported on Tuesday that the Federal Government plans to deliver up to 400,000 barrels of Nigerian crude oil daily to the Dangote refinery.
According to the report, this supply is expected to occur over the next two months, totaling 24 million barrels between October and November 2024.
On Tuesday, oil marketers stated they had not received any information from NNPC or the Dangote refinery regarding the alleged cessation of NNPC as the sole off-taker of petrol produced by the Lagos-based facility.
Reports indicated that NNPC was no longer the exclusive buyer of petrol from the Dangote refinery, but both NNPC and Dangote did not confirm this despite multiple inquiries from reporters.
As the news about NNPC potentially no longer being the sole off-taker of Dangote petrol circulated in the oil sector on Tuesday, some depots halted the sale of products in their tanks, anticipating a possible increase in petrol prices.
However, the anticipated changes did not occur, as neither NNPC nor the Dangote refinery confirmed the claim. The depots that had initially halted sales resumed operations after a few hours.
On Tuesday, the Independent Petroleum Marketers Association of Nigeria announced that the NNPC portal for purchasing petrol had been reopened to its members. Previously, the portal had been closed to IPMAN members, limiting their access to pay for products. The reopening allows independent marketers to resume their purchases.
Several sources said the naira-for-crude deal is to last for six months. They also stated that the product is still being expected by the Dangote refinery.
“We’ve realised that many Nigerians are excited that the government has agreed to the naira-for-crude deal, but most people don’t know that the deal is to last six months in the first instance,” an impeccable source at the Dangote refinery who spoke in confidence due to lack of authorisation to speak on the matter, stated.
On Saturday, the Federal Government announced that it had begun selling crude oil and other refined products in naira. The Federal Ministry of Finance made this disclosure in a post on its X account.
The statement read, “The Minister of Finance and Coordinating Minister of the Economy announced that, in line with the Federal Executive Council directive, the sale of crude oil and refined petroleum products in naira has officially commenced as of October 1, 2024.
“Following a meeting of the Implementation Committee, chaired by the Minister of Finance on October 3, 2024, to conduct a post-commencement review of the Crude Oil and Refined Products Sales in Naira initiative, the commencement of this strategic initiative was affirmed by key stakeholders.”
