Dangote To Halt Fuel Supply To Nigeria As Naira-For-Crude Deal Hits Deadlock

Dangote Refinery is set to stop supplying petroleum products to the Nigerian market due to delays in renegotiating the naira-for-crude agreement.

While the refinery will continue exporting fuel, it currently sources all its crude oil from the international market, paying in U.S. dollars.

The refinery previously supplied Nigerian marketers in naira under an agreement with the Nigerian National Petroleum Company (NNPC) Ltd., which allowed it to purchase crude in local currency.

However, that arrangement has now ended.

On March 10, the NNPC discontinued the naira-for-crude deal with Dangote and other local refineries.

Despite reports of an immediate halt in supplies, NNPC’s Chief Corporate Communications Officer, Olufemi Soneye, clarified that the agreement—initially established in October 2024—remains in effect until the end of March.

He also confirmed that discussions are ongoing to establish a new deal.

Since October 2024, the NNPC has supplied over 48 million barrels of crude to Dangote Refinery, totaling more than 84 million barrels since the facility began operations in 2023.

The naira-for-crude agreement was originally designed to enhance local fuel availability, reduce Nigeria’s dependence on costly petroleum imports, and help stabilize pump prices.

However, with the current deal in limbo, the future of domestic fuel supply remains uncertain.

KanyiDaily recalls that the NNPCL recently started new negotiations with Dangote Petroleum Refinery to extend the naira-for-crude agreement.