There is hope that the Dangote Refinery may sell Premium Motor Spirit (PMS), popularly called petrol, to Nigerians at cheaper rate as the Federal Government has restored the crude and refined product sales in naira initiative.
Providing update on the initiative, the Federal Ministry of Finance, in its X handle, yesterday, said the Technical Sub-Committee on the Crude and Refined Product Sales in Naira initiative convened an update meeting on Tuesday to review progress and address ongoing implementation matters.
It disclosed that the meeting was attended by the Chairman of the Implementation Committee, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun; the Chairman of the Technical Sub-Committee and Executive Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji; and Chief Financial Officer of Nigerian National Petroleum Company Limited (NNPCL), Dapo Segun.
Others are the Coordinator of NNPCL Refineries, Management of NNPC Trading, representatives of Dangote Petroleum Refinery and Petrochemicals and senior officials of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Central Bank of Nigeria (CBN), Nigerian Ports Authority (NPA) and Afreximbank, as well as the Secretary of the Committee, Hauwa Ibrahim.
The ministry added: “The stakeholders reaffirmed the government’s commitment to the full implementation of this strategic initiative, as directed by the Federal Executive Council (FEC). Thus, the Crude and Refined Product Sales in Naira initiative is not a temporary or time-bound intervention, but a key policy directive designed to support sustainable local refining, bolster energy security, and reduce reliance on foreign exchange in the domestic petroleum market.”
The committee noted that as with any major policy shift, the committee acknowledges that implementation challenges may arise from time to time.
“However, such issues are being actively addressed through coordinated efforts among all parties. The initiative remains in effect and will continue for as long as it aligns with the public interest and supports national economic objectives,” it said.
While acknowledging potential challenges of the naira transaction, the government assured that implementation remained on track, with all parties working to address any issue that might arise.
The naira-for-crude deal, introduced in October 2024, allows domestic refiners to purchase crude oil in naira instead of foreign currencies, aiming to strengthen local refining, reduce dependence on foreign exchange, and bolster energy security. However, the deal faced a setback earlier this year, leading to widespread concerns about its future.
In March 2025, the first phase of the six-month deal between NNPCL, domestic refiners, including Dangote Refinery and the government ended.
One of the reasons cited for the suspension was the commitment of crude oil production to prior forward contracts, preventing NNPCL from fully adhering to the naira-for-crude framework.
Dangote, during the suspension of the deal, had disclosed that its naira sales had already exceeded the value of locally-denominated crude oil received, making it necessary to switch to dollar-based sales.
Following the suspension in March, Dangote ceased selling refined petroleum products in naira, citing the non-renewal of the agreement. This development triggered fears of potential increases in fuel prices, as the refinery was forced to revert to sourcing crude oil in foreign currencies, thus driving up the cost of refined products.
The suspension of the naira-for-crude deal also raised concerns about the impact on Nigeria’s foreign exchange reserves. As the price of crude oil is typically settled in U.S. dollars, the suspension forced domestic players to seek foreign currency, which added further pressure on the country’s already strained foreign exchange market. With the naira struggling against the dollar, these developments could increase Nigeria’s economic challenges, particularly inflation and the cost of living for ordinary Nigerians.
Adedeji had said there had been no policy-level decision to discontinue the framework. He emphasised that the naira-for-crude arrangement remains in place, with the government fully committed to its goals of enhancing local refining capacity and reducing reliance on foreign currency.
The policy was designed to support local refineries like NNPC’s refineries and Dangote Refinery, ensuring that crude oil transactions could occur in naira, thus supporting the country’s efforts to enhance domestic refining capacity and reduce its reliance on foreign currency for the importation of petroleum products.