The Crude Oil Refinery-owners Association of Nigeria (CORAN) has confirmed the end of the Naira-for-Crude initiative of the Federal Government which was aimed at supporting local refineries.
The National Publicity Secretary of CORAN, Eche Idoko, in a chat with Nairametrics, explained that the first phase of the Naira-for-crude arrangement was meant to end in March and it has ended.
Idoko, however, clarified that contrary to speculations that the arrangement was terminated by the Nigeria National Petroleum Company Limited (NNPC), the first phase of the arrangement has ended.
He noted that the association is hoping for a renewal but has yet to hear from the federal government on that.
He said: “The Naira for Crude agreement was supposed to end in March as the first phase and it has ended and we are yet to get the government’s renewal.
“So it was not as if the NNPC terminated it. The original agreement was that it was supposed to end, the pilot phase was supposed to end in March, and then after which they would assess it and see whether it was of any impact and then renew.
“They have not communicated to us on that and so that’s where we are now.”
About the Naira-for-Crude initiative
Last year, the Federal Executive Council (FEC) approved the Naira-for-Crude initiative in which local refineries will be supplied crude oil in Naira rather than dollars.
- This was aimed at stabilizing fuel pump prices and the dollar-Naira exchange rate.
- However, Nairametrics reported that the implementation of the initiative was inconsistent, causing local refineries to struggle for crude supplies to maintain operations.
According to the federal government, during the approval of the initiative, local refineries would be allocated 450,000 barrels of crude oil per day with the Dangote refinery receiving 385,000 bpd (or 12 million barrels per month).
- However, documents seen by Nairametrics show that the Dangote refinery was allocated only 61,290 barrels per day in February 2025 under the Naira-to-Crude arrangement.
- In the whole of February, the refinery was allocated cargoes of 6.5 million barrels, while the allocation was reduced to 4.75 million barrels for March.
Local refiners said the inconsistency of the Naira-for-crude initiative disrupted crude supplies.
What you should know
- Despite an increase in Nigeria’s crude oil production, the country still imports as local refineries fail to get feedstock locally. The 650,000 bpd Dangote refinery, in its efforts to optimise its full capacity of refining 650,000 barrels per day, has resorted to importing crude oil from the United States in the absence of sufficient supplies locally.
- Nairametrics reported that Nigeria imported 47,000 barrels per day of U.S. WTI crude in 2024, with a substantial share going to the Dangote refinery. In December 2024, Dangote Refinery got shipments of imported crude up to 358,000 barrels per day in December 2024, according to Tanker-tracking data compiled by Bloomberg.
- This situation has exposed Nigerians to the volatility of the global oil market.
