The Nigerian government has confirmed that starting from October 2024, the Nigerian National Petroleum Company Limited (NNPC) will begin supplying crude oil in Naira to the Dangote Refinery.
This move aims to lower the cost of Premium Motor Spirit (PMS), commonly known as petrol. The confirmation was made by Dare Adekanmbi, spokesperson for Zacch Adedeji, Chairman of the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency.
The decision follows a recent approval by the Federal Executive Council, under President Bola Tinubu, for local refineries to purchase crude in Naira, effective from October 1, 2024.
The NNPC is set to supply around 385,000 barrels of crude oil per day to the Dangote Refinery, with equivalent refined diesel and petrol volumes to be sold domestically in Naira. This monthly supply amounts to 11.5 million barrels of crude.
Eche Idoko, Publicity Secretary of the Crude Oil Refinery-owners Association of Nigeria, has called for this Naira-for-crude arrangement to be extended to other modular refineries in the country, not just the Dangote Refinery.
Petroleum marketers have expressed optimism, predicting that this move will lead to a reduction in petrol prices in the domestic market.
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Hopefully the expected price reduction will be achieved. Fingers crossed.