The Federal Government has begun efforts to secure a steady supply of crude oil for the Dangote Petroleum Refinery by sourcing the commodity through international trading partners, as part of measures to sustain local refining operations.
Industry insiders revealed that the initiative is being coordinated through the Nigerian National Petroleum Company Limited (NNPCL), which is tapping into its global crude trading network to obtain additional supplies for the refinery amid shortages in local allocations.
However, officials involved in the arrangement cautioned that the move may not lead to an immediate reduction in petrol prices for Nigerian consumers.
Fuel Prices Surge Nationwide
The development comes at a time when Nigerians are facing another spike in the cost of petrol following fresh pricing adjustments by the $20 billion refinery located in the Lekki Free Trade Zone.
Within just one week, the refinery’s gantry price for Premium Motor Spirit (PMS) reportedly climbed from ₦774 per litre to about ₦995 per litre.
The increase has pushed pump prices in many states beyond ₦1,000 per litre, with some filling stations reportedly selling as high as ₦1,200 per litre.
The rising fuel costs have intensified economic pressure on households and businesses already dealing with inflation and higher transportation costs.
Oil marketers also disclosed that the refinery recently paused the loading of petrol temporarily, a development that has sparked concerns that another round of price increases could be on the horizon.
Global Tensions Affecting Crude Supply
Energy analysts say part of the pressure on fuel prices is linked to escalating geopolitical tensions in the Middle East, particularly the confrontation involving Iran, Israel and the United States.
The crisis has driven global oil prices higher, with Brent crude reportedly rising above $92 per barrel.
Concerns over possible disruptions around the Strait of Hormuz—a major global energy shipping route—have also added to market volatility.
A senior official at NNPCL confirmed that the company is actively procuring crude from third-party suppliers abroad to keep the refinery running.
“Through our global trading network, we are sourcing crude oil from international traders at rates that are competitive with prevailing market prices,” the official explained.
He added that the national oil company remains committed to strengthening Nigeria’s domestic refining capacity.
“As the national oil company responsible for protecting the country’s energy security, NNPC Limited will continue to support local refining initiatives, including the Dangote refinery,” he said.
Challenges With Domestic Crude Supply
The refinery has repeatedly raised concerns about difficulties in accessing enough locally produced crude oil.
Under the government’s naira-for-crude policy, the refinery is expected to receive around 13 cargoes of crude each month from NNPCL.
However, industry sources say it currently receives only about five cargoes monthly, forcing the facility to buy additional crude from the international market at global prices.
A refinery insider noted that the broader global energy situation is also contributing to the pressure on refined product costs.
“The Middle East crisis is pushing up prices across the entire energy market—from crude oil to LNG—and that naturally affects the cost of refined products worldwide,” the source said.
Calls for full implementation of naira-for-crude policy
Energy stakeholders believe that ensuring consistent domestic crude supply could help stabilise petrol prices.
The National Publicity Secretary of the Crude Oil Refinery Owners Association of Nigeria, Eche Idoko, said the refinery requires about 14 cargoes of crude monthly under the naira-for-crude arrangement to meet its operational needs.
He warned that reliance on imported crude means additional costs may ultimately be transferred to consumers.
Meanwhile, the Chief Executive Officer of Petroleumprice.ng, Jeremiah Olatide, said the current market structure has strengthened the refinery’s dominance due to restrictions on petrol import licences.
According to him, nearly 90 percent of marketers that applied for permits to import PMS were not granted approval.
Olatide suggested that allowing limited fuel imports could help stabilise the market.
“Ideally, imports should account for about 20 to 25 percent of supply while the rest is refined locally. That balance would improve energy security and support the economy,” he said.
Nigeria Importing More Crude
Recent data from the energy analytics firm Kpler shows that Nigeria’s imports of crude oil from the United States have risen sharply.
US crude shipments to Nigeria reached 41.13 million barrels in 2025, compared with 15.79 million barrels in 2024—an increase of about 161 percent.
The surge highlights Nigeria’s growing reliance on imported crude to keep its refineries running despite being Africa’s largest oil producer.
Expansion Of Distribution Network
In response to supply challenges, the Dangote Petroleum Refinery has expanded its network of petroleum marketers to strengthen product distribution across the country.
The number of approved distribution partners has reportedly grown from 13 companies to more than 30 nationwide.
Major partners include NIPCO Plc, MRS Oil Nigeria Plc, TotalEnergies Marketing Nigeria Plc and Conoil Plc.
Analysts say the expansion is aimed at improving supply channels while navigating crude shortages and fluctuating global oil prices.
Also Read: Why Transport Fares May Soon Rise in Lagos as Fuel Prices Near ₦1,000
With petrol now selling between ₦1,030 and ₦1,100 per litre in major cities, transportation fares and the prices of goods and services have already begun to climb, further straining consumers.