NNPC Limited has finalized arrangements to step up its crude oil supply to the Dangote Petroleum Refinery, with plans to deliver seven cargoes in May 2026. This is a notable increase from the five cargoes provided in previous months and suggests a growing focus on supporting local refining capacity. Sources familiar with the matter informed Reports that this adjustment reflects the national oil company’s intent to prioritize the domestic market in its upcoming allocation cycles.
However, the move has been met with mixed reactions from industry stakeholders who believe the increase still falls short of what is required. Colman Obasi, the National President of the Oil and Gas Services Providers Association of Nigeria, pointed out that while any increase is welcome, seven cargoes are simply not enough for a facility designed to process 650,000 barrels per day. He argued that with global trade flows currently disrupted by ongoing crises in the Middle East, it is more critical than ever for Nigeria to ensure its own refineries are running at full steam.
Sharing a similar view, another industry expert speaking to Reports emphasized that as a leading crude producer, Nigeria should be doing more to keep its resources at home. The expert noted that allocating more cargoes for domestic use isn’t just about fuel; it’s a strategic move to slash crude oil imports and conserve the country’s precious foreign exchange reserves. There is a general consensus among analysts that the current supply levels do not yet match the ambitious goals set for the nation’s energy independence.
The gap between current supply and actual capacity was recently highlighted by David Bird, the Chief Executive Officer of the Dangote Refinery. Bird revealed that under the existing crude-for-naira agreement, the facility is actually supposed to receive between 13 and 15 cargoes every month to fully meet Nigeria’s domestic fuel needs. He noted that receiving only five or seven cargoes represents a significant underperformance of the original contract.
According to Bird, this supply shortfall has financial implications that extend beyond the refinery itself. He explained that the difference between the intended purchase price and the current market premiums means that revenue is essentially leaking out of Nigeria and into the hands of international traders. He further clarified that the crude-for-naira policy was never designed as a favor to the refinery, but rather as a tool to protect the national economy from foreign exchange volatility.
As the May deadline approaches, all eyes are on how this increased allocation will impact the local market. While the move to seven cargoes is a step in the right direction, the pressure remains on the authorities to bridge the remaining gap and ensure the country’s refining giants can operate at the scale needed to stabilize the economy.
