In a bold move to stabilize fuel prices and the exchange rate, President Tinubu has ordered the Nigerian National Petroleum Company (NNPC) to sell crude oil to the Dangote Refinery in Naira, effective immediately.
_ Key Highlights of the Presidential Directive _
– _Naira Transactions_: NNPC will sell crude to Dangote Refinery and other new refineries in Naira, maintaining a stable exchange rate.
– _Initial Supply_: NNPC will provide four out of the 15 annual shipments required by Dangote Refinery, totaling $13.5 billion.
– _Local Consumption_: 450,000 barrels will be made available for local consumption, offered to Nigerian refineries in Naira, starting with Dangote Refinery.
– _Constant Exchange Rate_: The exchange rate will remain fixed throughout the transaction.
– _Afreximbank Support_: Afreximbank and Nigerian settlement banks will facilitate trade between Dangote and NNPC Limited, eliminating the need for international letters of credit and resulting in significant cost savings.
This presidential directive aims to reduce the country’s reliance on imported refined fuel, saving billions of dollars and promoting economic growth. The move is seen as a lifeline for the Dangote Refinery and a significant step towards achieving fuel price stability and exchange rate stability.