Nigerians may face a rise in the prices of premium energy products, including diesel and petrol, as the Dangote Petroleum Refinery temporarily suspends the sale of petroleum products in Naira.
“This decision is necessary to avoid a mismatch between our sales proceeds and crude oil purchase obligations, which are currently denominated in US dollars,” the company stated in a Wednesday release.
The $20 billion refinery located in Lagos noted that the sales of its products in Naira had surpassed the value of Naira-denominated crude it had received from the Nigerian National Petroleum Company Limited (NNPCL).
“As a result, we must temporarily adjust our sales currency to align with the currency of our crude procurement,” the company explained.
The refinery assured that it remains committed to serving the Nigerian market and will resume Naira-based sales once it receives Naira-denominated crude cargoes from NNPCL.
The announcement comes amid an ongoing price dispute with the NNPCL. In an effort to reduce pressure on the US dollar and stabilize fuel prices, the Federal Executive Council (FEC) instructed the NNPCL in July 2024 to sell crude oil to Dangote Refinery and other local refineries in Naira, rather than US dollars.
In early March 2025, the NNPCL revealed that the Naira-denominated crude sales agreement with Dangote Refinery would expire in March 2025, with discussions underway for a replacement contract. Since October 2024, the NNPCL has supplied over 48 million barrels of crude oil to the Dangote Refinery under this agreement.
Since its operations began in 2023, the NNPCL has supplied more than 84 million barrels of crude oil to the private refinery.
Nigeria, Africa’s most populous country, has long struggled with energy challenges, as all of its state-owned refineries had been non-operational for decades until 2024. The country has been heavily reliant on imported refined petroleum products, with the NNPCL being the primary importer.
Fuel queues are common in Nigeria, and the removal of the subsidy in May 2023 by President Bola Tinubu saw petrol prices increase from around ₦200 per litre to approximately ₦1,000 per litre. This surge in prices has worsened the situation for citizens who rely on petrol to power their vehicles and generators due to unreliable electricity supply.
In December 2024, the billionaire industrialist behind the Dangote Refinery began operations with a capacity of 350,000 barrels per day. The refinery, initially delayed by regulatory issues, aims to reach its full capacity of 650,000 barrels per day by the end of 2025. It has started supplying diesel, aviation fuel, and now petrol to marketers in the country.
