The Nigerian National Petroleum Company (NNPC) Limited has halted the naira-for-crude oil swap deal with Dangote Refinery and other domestic refiners.
The naira-for-crude arrangement, introduced on October 1 2024, allowed local refiners to purchase crude oil in naira instead of dollars.
It was designed to support domestic refining capacity, reduce reliance on imported petroleum products, and stabilize the local currency by easing pressure on foreign exchange reserves.
The decision, which took immediate effect, has sparked discussions about its implications for Nigeria’s energy sector and the broader economy.
The termination of the agreement means that Nigerian refineries, including the much-anticipated Dangote facility, will now have to source crude oil from international suppliers, paying in dollars instead of naira, which could increase operational costs.
Reports say the NNPC informed local refiners that it has already committed its crude oil production to forward contracts, leaving no supply available for domestic refineries.
This is despite reports that Nigeria’s crude output has increased since the deal first began.
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