Onome Amuge
Dangote Petroleum Refinery and Petrochemicals has announced the immediate resumption of petrol sales in Naira. This follows the intervention of the of the Naira for Crude Technical Committee, chaired by Wale Edun, the minister of finance and coordinating minister of the economy.
Customers can now place orders and make payments in Naira for both self-collection and free delivery of petrol at previously specified locations nationwide. In a message to its customers, the refinery stated that customers can now place orders and make payments in Naira for both self-collection and free delivery of petrol at previously specified locations nationwide.
The refinery had earlier suspended petrol sales in Naira amid ongoing challenges related to foreign exchange and crude oil pricing mechanisms. The intervention by the technical committee, formed to facilitate the use of the Nigerian currency in crude purchases and downstream petroleum product transactions, has helped bridge the gaps between the refinery and its customers.
The message from the Group Commercial Operations reads: “Dear Valued Customer, Following the intervention of the Naira for Crude Technical Committee chairman, we are pleased to inform you of the resumption of PMS sales in Naira, commencing immediately. You may kindly proceed to place your orders in Naira for both self-collection and free delivery of PMS to the earlier advised locations across the country.”
The crude-for-Naira initiative was designed as a cushion against the country’s foreign exchange shortages. By allowing domestic refiners like Dangote to purchase crude in local currency, the government effectively insulated petrol pump prices from global oil market volatility and dollar scarcity.
Yet, the model is riddled with contradictions. Oil is Nigeria’s main source of foreign exchange earnings, and allocating large volumes of crude in Naira denies the treasury valuable dollar inflows at a time reserves remain under pressure. On the other hand, without Naira-based allocations, refiners must buy crude in dollars, which could push petrol prices far beyond the reach of ordinary Nigerians.
For investors, the recent back-and-forth reflects poorly on Nigeria’s policy credibility. Dangote Refinery, which cost over $20 billion to build and is considered the flagship project of Nigeria’s industrialisation drive, has found itself at the mercy of unpredictable allocation mechanisms and emergency interventions.
For ordinary Nigerians, the immediate benefit of the resumption is that petrol prices remain steady, at least for now. A switch to dollar-based sales would have meant higher landing costs for marketers, quickly translating into pump prices well above N1,000 per litre. Such an increase would have cascaded through transport fares, logistics costs, and food prices, worsening already high inflation.
Dangote Refinery has been positioned as a cornerstone of Nigeria’s energy self-sufficiency agenda, with the capacity to process 650,000 barrels per day of crude. Yet, the latest development shows that even a facility of this magnitude cannot escape the volatility of Nigeria’s political economy.
By exhausting its crude-for-Naira allocation, the refinery was forced to confront the gap between government promises and operational realities. Analysts say the refinery had been supplying PMS in excess of its allocation for months, effectively subsidising the system until it became unsustainable.
