By Adewale Sanyaolu
Hopes of a further drop in fuel price brightened yesterday as the Federal Government announced the continuation of the Naira-for-Crude policy.
In a statement, the ministry of finance announced that the decision to sustain the initiative was taken after a meeting of the technical sub-committee on the crude and refined product sales in naira initiative headed by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy.
In attendance were the Chairman of the Technical Sub-Committee and Executive Chairman of the Federal Inland Revenue Service (FIRS), Dr. Zacch Adedeji; the Chief Financial Officer of NNPC Limited, Mr. Dapo Segun; the Coordinator of NNPC Refineries; Management of NNPC Trading; representatives of Dangote Petroleum Refinery and Petrochemicals; and senior officials from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the Central Bank of Nigeria (CBN), the Nigerian Ports Authority (NPA), representative of Afreximbank, as well as the Secretary of the Committee, Hauwa Ibrahim.
“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 to continue with the deal is a welcome development, especially in the face of 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 the series of price slashes by Dangote.
The CORAN Publicity Secretary explained that the price slashes by Dangote refinery was made possible by the Naira-for-Crude policy which eventually translated to better deal for Nigerians, adding that as soon as Dangote announced its suspension to continue to sell products in naira, petroleum product prices went up.
“So now that Government has said the deal would continue, I can assure stakeholders and members of the public that we will begin to see prices go down again and the country will witness self sufficiency of products,’’.
The first phase of the six-month deal involving the Federal Government, Nigerian National Petroleum Company Limited, and Dangote Petroleum Refinery ended March 31, 2025.
It has not been renewed, and the Dangote refinery has since stopped selling refined petroleum products in naira due to the non-renewal of the naira-for-crude deal.
This came as a report by S&P Global last week stated that the Dangote refinery processed approximately 400,000 barrels per day of crude oil in 2025 so far, with about 35 per cent of this supply being sourced from international imports.
This means the plant imported about 140,000 barrels of crude oil per day and a total of 12.6 million barrels in three months.
With the Federal Government agreeing to continue with the Naira-for-Crude deal, oil imports by the refinery will reduce in the months ahead, thereby conserving foreign exchange for the country.
Government officials at the meeting emphasised that the policy aligns with Nigeria’s long-term economic objectives, especially in reducing reliance on foreign reserves, encouraging local content development, and creating a more stable pricing structure for petroleum products.
“This policy is a crucial step in reducing the demand for dollars in domestic petroleum transactions while positioning the Naira as a viable currency for energy trade,” the statement added.
The Ministry reiterated that the Naira-for-crude initiative will continue indefinitely, as long as it remains beneficial to national interest and economic goals.
Recall that the Federal Government through the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency on October 1, 2024 confirmed the commencement of supply of crude in naira by the Nigerian National Petroleum Company Limited to the Dangote Petroleum Refinery.
“From October 1, NNPC will commence the supply of about 385kbpd (385,000 barrels per day) of crude oil to the Dangote refinery to be paid for in naira,” the committee had declared.
Mr Dare Adekanmbi, the Special Adviser on Media to the FIRS Chairman, Zacch Adedeji, the Chairman of the Technical Sub-Committee, confirmed this during a media enquiry.
He said, “I can confirm to you that the Chairman, Sub-Technical Committee, Zacch Adedeji, is working day and night to ensure that things go according to plans. He knows how important it is to have the agreement implemented as has been planned for the benefit of Nigerians.”
This implies that NNPC is to supply about 11.5 million barrels of crude oil to the Dangote refinery monthly, and based on the deal, the plant will release equivalent volumes of refined diesel and petrol to the domestic market also in naira.
He stated that crude would be sold to Dangote in naira from October 1, in return, the Dangote refinery will supply PMS (petrol) and diesel of equivalent value to the domestic market to be paid in naira.