Marketers hint at new petrol price as FG is set to begin naira-for-crude deal with Dangote refinery

• For a period of six months, the NNPC would first provide crude oil in naira to the Dangote petroleum refinery
• This will be achieved following a review by the technical subcommittee on domestic sales of crude oil in local currency
• The Federal Government intends to supply up to 400,000 barrels of Nigerian crude oil per day to the Dangote plant

Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.

The Nigerian National Petroleum Company Limited would first supply the Dangote Petroleum Refinery with crude oil in naira for a period of six months, subject to a follow-up assessment by the technical sub-committee on domestic sales of crude oil in local currency.

crude oil is priced in dollars and is considered an international product. Photo Credit: NNPC, Dangote
Source: UGC

The first phase of the naira-for-crude contract is expected to last six months, as multiple sources from the committee and the Dangote refinery revealed on Monday. This is as crude oil is priced in dollars and is considered an international product.

According to a Monday Bloomberg report, the Federal Government plans to provide the Dangote refinery with up to 400,000 barrels of Nigerian crude oil each day.

The report pointed out that the development is anticipated to occur over the course of the following two months, translating into a delivery of 24 million barrels of crude oil from Nigeria between October and November of 2024.

Did NNPC quit being sole importer?

On Monday, oil marketers announced that they had not received any information from NNPC or the Dangote refinery on NNPC's purported suspension as the exclusive buyer of petrol produced by the refinery located in Lagos.

There were rumours stating that NNPC was no longer the only company that purchased gasoline from the Dangote refinery. NNPC and Dangote declined to confirm this, even after The Punch correspondents contacted them multiple times to inquire about the situation.

Some depots stopped selling products kept in their tanks as they braced themselves for a possible spike in fuel prices following reports of NNPC's alleged pullout as the exclusive off-taker of Dangote petrol.

Possible price hike?

Depot owners were alarmed to learn that NNPC, the only company that purchases petrol from the Dangote refinery, was reportedly stopping its operations. Dealers halted sales of petrol for several hours, fearing that the commodity's price would increase.

Responding to an enquiry on whether NNPC had stepped aside as the sole off-taker of Dangote petrol, a major oil marketer said,

“It seems true as virtually all depots are awaiting the new price of petrol. There are no sales for now in virtually all depots in Apapa. It seems DR (Dangote refinery) has yet to give its price.”

However, the source added later that the depots had started selling goods again after NNPC and the Dangote refinery had stopped talking about it.

In addition, IPMAN said that it was waiting for word from the Dangote refinery before off-taking petrol from the plant.

According to the statement made by Chinedu Ukadike, the Publicity Secretary of IPMAN, the group is awaiting word from Dangote refinery regarding the launch date for independent marketers.

“As soon as Dangote gives us feedback and commencement for lifting notification, then we will start. The notification will be accompanied by the price they will be selling to us as independent marketers,” he stated.

NNPC portal now opened

IPMAN said last week that its access to products was being restricted by the extended shutdown of the portal.

Olufemi Soneye, a NNPC spokesman, claims that the portal was taken down because of a large backlog.

Soneye added that the stoppage became necessary to stop NNPC from keeping marketers’ funds for too long.

However, IPMAN Publicity Secretary Ukadike said that the national oil firm had restored the portal, giving marketers access to items, in an exclusive interview with Punch on Monday.

NNPC to Revise Fuel Prices

Legit.ng reported that the Nigerian National Petroleum Company Limited (NNPC) is gearing up to introduce a fresh pricing regime for the product despite last month's adjustments.

Sources close to the development reveal that the changes are imminent, setting the stage for increased hardship for Nigerians.

On September 3, the NNPC raised the price of petrol at its filling stations from N617 per litre to between N855 and N897, depending on the location.

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Source: Legit.ng