Audio By Carbonatix
Nigeria's Dangote Petroleum Refinery has begun pricing fuel products for the local market in U.S. dollars, with a company spokesperson on Tuesday citing difficulties securing sufficient crude under the government's naira-for-crude programme and rising global oil prices.
The naira-for-crude programme, launched in October 2024, allowed domestic refiners to purchase crude in the local currency and reduced pressure on the foreign exchange market.
Africa's largest refinery, with a capacity of 700,000 barrels per day, has set the ex-depot price of petrol at $0.779 per litre, diesel at $1.087 per litre and aviation fuel at $0.942 per litre, according to a pricing template circulated to marketers.
Edwin Devakumar, vice president of the Dangote Group, said the refinery had been absorbing a currency mismatch by selling products in naira while sourcing crude in dollars, but limited crude supply under the naira-for-crude programme had undermined the arrangement's viability.
Although state-owned oil company NNPC increased Dangote's allocation to seven cargoes in May from about five previously, the refiner has said it requires 13 to 15 cargoes a month and has been forced to import the remainder at international prices.
The decision could boost demand for dollars among fuel marketers and make domestic fuel prices more sensitive to exchange-rate fluctuations.
The sector regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), did not immediately respond to a request for comment.
Dangote has become a major local petrol supplier, helping to reduce the country's dependence on fuel imports, but has struggled to secure sufficient volumes in Nigeria.
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