FG Steps In to Secure Crude for Dangote Refinery as Petrol Prices Rise

The Federal Government has initiated steps to ensure steady crude oil supply to the Dangote Petroleum Refinery by engaging third-party international traders through the Nigerian National Petroleum Company Limited (NNPCL). The move is aimed at sustaining local refining operations at the $20bn facility in Lekki.

However, officials familiar with the development cautioned that the intervention may not immediately lead to a reduction in petrol prices. Nigerians are already facing elevated fuel costs following recent price increases announced by the refinery.

Industry sources and oil dealers also confirmed that the refinery recently halted the loading of Premium Motor Spirit (petrol), a situation that has triggered speculation about another possible hike in fuel prices.

If implemented, it would mark the third petrol price increase within a week. Recent adjustments had already raised gantry prices from N774 to N995 per litre, pushing pump prices above N1,000 per litre in several states. In some locations, petrol is now selling for as much as N1,200 per litre, further worsening the financial strain on consumers.

This comes as recent market data illustrates the shift in crude sourcing patterns. Kpler analytics show that crude imports by Nigeria from the United States surged to 41.13 million barrels in 2025, up 161 per cent from 15.79 million barrels in 2024.

Amid the fuel price hike in Nigeria, motorists and industry observers are bracing for the impact on transport fares and the cost of goods. The refinery’s temporary halt in PMS loading, the second within a week, reflects logistical challenges in sustaining domestic supply, particularly given global crude market volatility. Analysts note that stabilising prices depends heavily on reliable crude allocation to domestic refineries.

One critical factor is the geopolitical crisis in the Middle East, especially the Iran-US conflict, which has disrupted oil supply chains and pushed Brent crude prices above $92 per barrel. Tensions around the Strait of Hormuz, a vital energy transit corridor, have compounded the global price surge. The disruption has made it costly and difficult for refiners relying solely on local crude.

Multiple industry sources and officials from both NNPC and Dangote refinery confirmed that the national oil company is leveraging its global crude trading network to source third-party supply for the Dangote refinery at competitive international market rates.

The Dangote refinery has, however, cautioned that sourcing crude internationally may not immediately reduce pump prices.