Nigeria’s downstream oil sector is on edge as reports suggest that Dangote Refinery may suspend the supply of petroleum products to the local market. The move is reportedly linked to unsuccessful renegotiations of the naira-for-crude deal, which has seen little progress.
Insiders reveal that the refinery, which sources crude from the international market in dollars, will continue exporting products while halting domestic supplies. However, Dangote Group’s spokesperson, Anthony Chiejina, dismissed the reports, stating, “I am not aware.”
The Nigerian National Petroleum Company Limited (NNPCL) recently acknowledged discussions with Dangote Refinery over renewing the naira-for-crude deal established in October last year. Under the agreement, Dangote Refinery supplied fuel to Nigerian marketers in naira, having bought crude from NNPCL in the same currency.
The potential halt comes amid a pricing battle between Dangote Refinery and NNPCL that drove down the price of premium motor spirit (PMS) to about N860 per litre. The prospect of supply suspension raises concerns about possible fuel scarcity and price hikes, further straining Nigeria’s already fragile fuel market.
