Fuel Crisis Fears Rise As Dangote Refinery Halts Petrol Loading, FG Rushes To Secure Crude Supply

The Federal Government has initiated fresh efforts to secure crude oil supply for the Dangote Petroleum Refinery through international third-party traders in a move aimed at sustaining domestic refining operations. According to Ireporter Online, the intervention is being coordinated by the Nigerian National Petroleum Company Limited as supply challenges continue to affect the refinery’s access to sufficient local crude.

Industry insiders revealed that the national oil company is relying on its global crude trading network to source additional cargoes for the refinery amid ongoing constraints in domestic allocations. Despite the intervention, officials cautioned that the move may not immediately lead to a reduction in petrol prices across the country.

The development comes at a time when Nigerians are facing escalating fuel costs following recent price adjustments by the Lekki-based refinery valued at about $20 billion. Within the space of a week, petrol gantry prices reportedly climbed from ₦774 per litre to about ₦995 per litre, pushing pump prices above ₦1,000 per litre in several states.

In some parts of the country, filling stations are said to be selling petrol for as high as ₦1,200 per litre, deepening the financial pressure on households and businesses already struggling with rising living costs. Oil marketers also confirmed that the refinery recently halted the loading of Premium Motor Spirit (PMS) temporarily, a development that has sparked concerns of a possible further price hike.

Energy experts attribute part of the current pressure on fuel prices to geopolitical tensions in the Middle East, particularly the ongoing conflict involving Iran, the United States and Israel. The crisis has pushed global oil benchmarks higher, with Brent crude reportedly trading above $92 per barrel, while supply chains in the international energy market continue to experience disruptions.

The rising tension around the Strait of Hormuz—one of the world’s most vital oil shipping corridors—has also contributed to the spike in crude prices. A senior official at the national oil company confirmed that crude is now being sourced through international traders to maintain steady feedstock supply for the refinery.

According to the official, the company is leveraging its global trading connections to obtain third-party crude at competitive prices aligned with prevailing international market rates. He added that the national oil company remains committed to supporting domestic refining capacity as part of efforts to strengthen Nigeria’s energy security.

Sources within the refinery also acknowledged ongoing difficulties in securing enough local crude supply. Under the government’s naira-for-crude initiative, the refinery is expected to receive about 13 cargoes of crude monthly from the national oil company. However, it currently receives roughly five cargoes per month, forcing the facility to depend on imported crude purchased at global market prices.

A refinery source explained that the wider global energy crisis is influencing the cost of refined products worldwide. According to the source, the current tensions in the Middle East are affecting the prices of crude oil, liquefied natural gas and other fuels, with ripple effects on refined petroleum product pricing globally.

Energy stakeholders believe that improving domestic crude supply to the refinery could help stabilise petrol prices in the country. The National Publicity Secretary of the Crude Oil Refinery Owners Association of Nigeria, Eche Idoko, stated that full implementation of the naira-for-crude policy would significantly support stable fuel pricing.

According to him, the refinery requires about 14 cargoes of crude monthly under the arrangement to meet its operational needs. He noted that continued reliance on imported crude exposes the refinery to international price fluctuations, which could ultimately be passed on to consumers.

Meanwhile, the Chief Executive Officer of Petroleumprice.ng, Jeremiah Olatide, said restrictions placed on petrol import licences have effectively strengthened the refinery’s position in Nigeria’s fuel market. He explained that nearly 90 percent of marketers who applied for permits to import PMS were reportedly denied approval.

Olatide argued that a balanced supply structure—where imports account for roughly 20 to 25 percent while the majority is refined locally—would enhance energy security and strengthen the economy.

Data from global shipping analytics firm Kpler also indicates a sharp increase in Nigeria’s crude imports from the United States. The figures show that US crude exports to Nigeria rose to about 41.13 million barrels in 2025, up from 15.79 million barrels recorded in 2024, representing a 161 percent increase.

The trend highlights the growing dependence of Nigerian refineries on imported crude despite the country being Africa’s largest oil producer. Amid the ongoing supply pressures, the Dangote refinery has also expanded its network of petroleum marketers to sustain product distribution nationwide.

The number of approved distribution partners has increased from 13 to more than 30 companies across the country, including firms such as NIPCO Plc, MRS Oil Nigeria Plc, TotalEnergies Marketing Nigeria Plc and Conoil Plc.

Industry analysts say the expansion is intended to strengthen nationwide fuel distribution while the refinery navigates supply constraints and volatile global oil prices. With petrol currently selling between ₦1,030 and ₦1,100 per litre in major cities, the rising cost of fuel is already pushing up transportation fares and the prices of goods and services across the country.