Abuja, Nigeria – March 10, 2025 – The Nigerian National Petroleum Company (NNPC) Limited has officially suspended the naira-for-crude oil swap arrangement with domestic refiners, including the Dangote Refinery and other private operators. The move comes as part of a broader effort to restructure the country’s crude oil supply framework and enhance transparency in the oil sector.
According to industry sources, the decision to halt the swap deal was driven by the need to address concerns related to pricing inefficiencies, foreign exchange volatility, and operational sustainability. The suspension means that domestic refiners will now have to pay for crude oil in U.S. dollars or seek alternative arrangements with NNPC.
In a statement, a senior NNPC official noted that the company is reviewing its crude allocation policies to ensure optimal benefits for the Nigerian economy. “We are committed to ensuring a fair and transparent process in the allocation and pricing of crude oil. The suspension of the naira-for-crude swap aligns with our long-term vision of positioning NNPC as a globally competitive entity,” the official stated.
The suspension is expected to have significant implications for domestic refining operations, as refiners like Dangote Refinery, which recently commenced operations, will have to reassess their crude sourcing strategies. Industry experts warn that this could lead to increased production costs and potential fuel price adjustments in the local market.
While some stakeholders have welcomed the move as a necessary step towards a market-driven oil sector, others express concerns about its impact on local refiners and the broader economy. Analysts suggest that if a viable alternative framework is not introduced swiftly, the decision could disrupt Nigeria’s refining industry and fuel supply chain.
NNPC has assured the public that it remains committed to supporting local refining capacity and will continue engaging stakeholders to develop a sustainable crude oil supply mechanism.
