President Bola Tinubu announced yesterday that the ongoing Naira-based sale of crude oil and refined products is set to usher in greater stability in Nigeria’s downstream oil sector. Speaking at a review meeting of the technical committee overseeing the implementation of this new arrangement at the State House in Abuja, Tinubu urged committee members to address any emerging challenges promptly.
The President emphasized that the shift to Naira transactions was designed to eliminate exchange rate obstacles, asserting his administration’s commitment to progressive decision-making. “Whatever solutions we implement regarding crude oil and refined product sales in Naira must avoid the pitfalls of the past 40 years. While there may be adjustments in costs and revenues within the oil sector, we cannot revert to outdated practices,” he stated.
Tinubu called on all stakeholders in the oil sector, including the Nigerian National Petroleum Corporation Limited (NNPC) and Dangote Group, to collaborate in enhancing the economy and improving the livelihoods of Nigerians. He stressed the need for local production of petrol and petroleum products to reduce dependence on imports, thereby allowing foreign exchange to be redirected towards the development of Nigeria’s real sector.
To facilitate the transition, the President encouraged stakeholders to engage with Afreximbank as a settlement bank for pricing crude and refined products in Naira. Afreximbank is already serving as the financial advisor for this initiative.
“The market must dictate our operations. By allowing market dynamics to determine profits and losses, independent marketers and the government can collaborate effectively. I want these issues resolved efficiently, without unnecessary delays,” Tinubu added. He expressed confidence in achieving energy security and maintaining the motivation of industry leaders like Alhaji Aliko Dangote for predictable long-term operations.
During the meeting, Wale Edun, Minister of Finance and Coordinating Minister of the Economy, reiterated that the administration’s groundbreaking decision to sell crude in Naira is irreversible. He confirmed that the government would not dictate exchange rates for the oil sector.
Aliko Dangote, President and Chief Executive of Dangote Group, informed the President that his refinery currently holds over 500 million litres of fuel in reserve after supplying 400 million litres to the domestic market. He expressed readiness to collaborate with NNPC to meet Nigeria’s estimated daily petrol demand of 32 million litres.
Zach Adedeji, Chairman of the Federal Inland Revenue Service (FIRS) and head of the technical committee, stated that the importation of refined products should cease once Nigeria develops sufficient capacity for local production. “The vision of Mr. President is to transform Nigeria into a hub for refined products to export globally,” Adedeji explained.
Other notable attendees included Professor Benedict Oramah, President and Chairman of the Board of Afreximbank, Senator Abubakar Bagudu, Minister of Budget and National Planning, and Mele Kyari, Group Managing Director of NNPC. The meeting also included the Special Adviser to the President on Energy, Olu Verheijen, and executives from various regulatory and maritime agencies.
After the meeting, Dangote urged NNPC and other petroleum marketers to cease importing Premium Motor Spirit (PMS), commonly known as petrol. He highlighted that his refinery’s stock of over 500 million litres could sustain the country for 12 days without any imports, given current consumption rates.
Addressing ongoing petrol scarcity issues, Dangote clarified that his company does not engage in retail, limiting its ability to alleviate fuel shortages directly. He encouraged retailers to purchase the available product instead of relying on imports. “If they don’t come forward to buy, what can I do? I expect NNPC or the marketers to stop importing and instead come to collect what we have,” he stated.
Dangote assured that with adequate crude supply, his refinery could produce more than 30 million litres of petrol daily. He expressed optimism about the meeting’s outcomes, stating that there would be sufficient Naira for crude to meet market demands and strengthen the initiative.
Briefing newsmen, also, is Minister of Finance, Mr Wale Edun shared insights from the meeting with Tinubu regarding the implementation of the initiative to sell crude oil to local refiners in Naira.
He said the initiative received full endorsement from the Federal Executive Council (FEC), with the aim of stabilising the petroleum market and enhancing local production capabilities.
Edun stated, “We had a session with Mr. President to review the implementation of this bold initiative. It allows local refiners to purchase crude oil and sell their products in Naira to the Nigerian public.”
He applauded Dangote Group’s substantial investment in a refinery with the capacity of 650,000 barrels per day as a key enabler of the initiative.
Edun emphasised that the implementation committee had been working diligently with various stakeholders, including regulatory bodies, such as NMDPRA and NNPC, to ensure the initiative’s success.
He said, “What we have achieved is the establishment of market pricing for petroleum products. This, coupled with market pricing for foreign exchange, sets our economy on a path toward industrialisation.”
Edun highlighted the broader economic implications of the initiative, stating that it would provide essential raw materials, not only for agriculture, but also for industries, such as chemicals, textiles, and building materials.
“This is part of Mr. President’s strategy to create favourable conditions for private sector investment, job creation, and economic growth,” he explained.