Dangote Refinery May Halt Domestic Fuel Supply, Stoking Market Jitters

Nigeria’s downstream oil sector is on edge following reports that Dangote Refinery may halt petroleum product loading for the domestic market.

The move stems from stalled renegotiations over the naira-for-crude agreement, a deal that previously allowed Nigerian marketers to purchase fuel in naira. Sources indicate that while local supply may be disrupted, the refinery will sustain exports since it acquires crude stock exclusively in dollars from the international market.

When contacted, Dangote Group’s spokesperson, Anthony Chiejina, claimed ignorance of any decision to cease domestic supply, stating, “I am not aware.”

This development comes amid ongoing discussions between the Nigerian National Petroleum Company Limited (NNPCL) and Dangote Refinery over a fresh contract for the naira-for-crude arrangement. The agreement, introduced in October last year, enabled Dangote to sell fuel in naira after securing crude locally through NNPCL.

The deal contributed to a sharp drop in petrol prices, which fell to as low as ₦860 per litre as a price war erupted between Dangote Refinery and NNPCL. However, with uncertainties surrounding the contract’s renewal, concerns grow over potential fuel supply disruptions and price volatility in Nigeria’s energy market.