By Adewale Sanyaolu
The Naira-for-crude deal, which is currently a subject of controversy, has led to the reversal of a fuel price cut arrangement earlier announced by Dangote Petroleum Refinery and three fuel marketing retail outlets.
Dangote, in its bid to ensure it gets a grip on the market, had last month sealed a pact with three fuel retail outlets, MRS, Heyden, and AP, to sell petrol at its various filling stations in Lagos, other South-West states, the North, the South-South, and the South-East at prices ranging between N860 and N895 per litre.
The agreement, aimed at offering Nigerians more affordable fuel by reducing the price of Premium Motor Spirit (PMS) at the pumps, potentially provides relief for consumers who have been facing high fuel costs.
This deal was expected to have a significant impact on the Nigerian oil and gas market, particularly in terms of price stability and fuel scarcity.
But despite the assurance by the Federal Government last week that the Naira-for-Crude would not be discontinued, feelers from the fuel market suggest otherwise, as MRS, Heyden, and AP have jerked up petrol prices from the N860 and N895 per litre earlier agreed with Dangote to N920 and N940 per litre, respectively—an indication that the earlier deal has collapsed.
In a statement shared last Wednesday via the official handle of the Federal Ministry of Finance, authorities clarified that the policy, which mandates the sale of crude oil and refined petroleum products in Naira for domestic transactions, is not a temporary measure but a strategic national directive.
“This initiative is not a stopgap solution but a strategic move designed to enhance sustainable local refining, reinforce energy security, and reduce the pressure on foreign exchange within the petroleum sector. The initiative remains in effect and will continue for as long as it aligns with the public interest and supports national economic objectives,” the ministry said.
The government explained that the policy aims to increase economic sovereignty by curbing the demand for dollars in local petroleum transactions, encouraging investment in domestic refining, and promoting the Naira as a stable currency for energy trade.
Committee members acknowledged that challenges are part of any major policy shift but assured that such issues are being addressed through coordinated efforts. “As with any major policy shift, the Committee acknowledges that implementation challenges may arise from time to time. However, such issues are being actively addressed through coordinated efforts among all parties,” the ministry stated.
While the disagreement on the deal between Dangote Refinery and NNPC lasted, the fuel market witnessed some level of disruption as petrol prices rose from N860 per litre to N930 per litre, leading to a rise in petrol imports by marketers.
Commenting on the development, Publicity Secretary of the Crude Oil Refiners Association of Nigeria (CORAN), Mr. Ichie Idoko, said the announcement by the Federal Government to continue with the deal is a welcome development, especially in the face of the tariff and trade war by the United States of America, signaling a warning that developing countries with natural resources should begin to add value to them.
He added that the decision by the Federal Government would see petroleum prices drop further, as witnessed in the series of price slashes by Dangote.
The CORAN Publicity Secretary explained that the price slashes by Dangote Refinery were made possible by the Naira-for-Crude policy, which eventually translated to a better deal for Nigerians, adding that as soon as Dangote announced its suspension of product sales in Naira, petroleum product prices went up.