Dangote Petroleum Refinery has reversed its recent dollar-pricing policy, resuming the sale of petrol in naira and setting a new ex-depot gantry price of ₦1,215 per litre.
The decision, announced on Wednesday, provides a measure of relief to marketers and consumers by eliminating foreign exchange exposure that had complicated planning and squeezed margins for local buyers.
The shift back to naira comes barely a week after the refinery switched to dollar-denominated sales, pegging petrol at $0.779 per litre. That move had created tension in the downstream petroleum market and sent petrol prices surging above ₦1,270 per litre at some depots, while retail prices rose to between ₦1,300 and ₦1,400 per litre.
While the return to naira pricing offers stability, the new price represents a ₦140 increase from the ₦1,075 per litre rate the refinery sold previously. The reversal followed reactions from independent petroleum marketers, who warned that prolonged dollar-pricing risked stoking inflation.
Fuel Sales in Dollars Raised Questions about Naira-for-Crude Deal
The fuel sales in dollar policy had revived concerns over the sustainability of the Federal Government’s Naira-for-Crude initiative and the country’s ability to guarantee adequate crude supply to domestic refiners.
Africa’s largest refining facility notified marketers on July 13 that it was ending naira-denominated pricing for petrol, diesel and aviation fuel, invalidating every naira proforma invoice and deal recap that had previously been issued for gantry and coastal transactions. In their place, the refinery introduced a dollar-linked pricing template, pegging premium motor spirit (PMS), also known as petrol, at $0.779 per litre, automotive gas oil (diesel) at $1.087 per litre and aviation fuel at $0.942 per litre. The coastal price of petrol cargoes was fixed at $1,044.62 per metric tonne. It said liquefied petroleum gas (cooking gas) remains the only product still sold in naira.
Shortly after the announcement of fuel pricing in dollars, the refinery suspended both gantry and coastal loading on Wednesday, July 15. This disrupted supply, forcing marketers to switch to private depots, which increased ex-depot prices to an average of ₦1,275 per litre from about ₦1,075 per litre before the Dangote Refinery suspended loading.
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Although the refinery had maintained that the move was necessitated by the need to align its sales with the currency in which it buys crude oil, industry analysts said the decision raised deeper questions about whether Nigeria’s ambitious domestic refining agenda is being undermined by persistent structural challenges in crude supply and foreign exchange management.
The Federal Government’s Naira-for-Crude initiative was introduced in October 2024 to reduce pressure on the country’s foreign exchange reserves, strengthen the naira, guarantee crude availability to local refineries and ultimately lower the cost of petroleum products for Nigerians.
Under the arrangement, local refiners receive crude oil from the Nigerian National Petroleum Company Limited (NNPC) in naira rather than dollars. In return, they are expected to refine petroleum products locally and sell them in the domestic market in naira, reducing dependence on imported fuel and shielding consumers from exchange rate volatility.
For several months, the policy was widely praised for helping to moderate petrol prices, improve local refining activity and reduce the country’s demand for foreign exchange. Economic experts also viewed it as a strategic step towards strengthening the naira by reducing the oil sector’s dependence on the dollar.
However, recent developments appear to have exposed vulnerabilities in the framework.
Industry observers noted that the refinery’s decision to switch to dollar-denominated sales suggests that crude supply under the naira arrangement was no longer sufficient to meet refining requirements.
Nigeria produces about 1.7 million barrels of crude oil daily, according to recent data released by the Nigeria Upstream Petroleum Regulatory Commission (NUPRC). However, a substantial portion is tied to long-term forward contracts, debt repayment obligations and international supply agreements. As a result, only a limited volume remains readily available for domestic refining.
The Dangote Refinery management had repeatedly raised concerns about failing to receive an adequate supply of crude feedstock from the NNPC, as agreed under the Naira-for-Crude agreement.
The refinery CEO, David Bird, had, in an interview earlier this year, raised concerns about shortfalls in Nigeria’s crude supply to the facility under the domestic supply agreement. Bird, who spoke in an interview on Arise Television, said the refinery, which is operating at its full capacity of 650,000 barrels per day, requires between 13 and 15 cargoes of crude monthly to meet domestic fuel demand, but was only receiving about five cargoes, representing just about 30 per cent of expected supply.
The Refinery had said that it imported about 21 million barrels at the cost of $2.6 billion in May alone.
Energy analysts argue that unless crude allocation to domestic refiners is prioritised and protected, the objectives of the Naira-for-Crude policy may remain difficult to sustain.
Speaking in a televised interview recently, an Oil and gas expert, Victor Udoh, asserted that the crude import data quoted by Dangote raises questions about the implementation of the government’s crude-for-naira arrangement. Udoh urged the federal government to increase crude supplies to the refinery under the policy.
Crude Oil Price Pressure on Domestic Fuel Cost
Analysts attribute the rise in the petrol gantry price to the sharp surge in global crude oil prices, which has affected the cost of refining to get petroleum products, including petrol, diesel and aviation fuel.
Pinnacle Daily reports that crude oil has risen above $90 per barrel from slightly below $70 recorded recently when the U.S. and Iran reached a ceasefire on the ongoing war in the Middle East, which disrupted global energy supply.
However, following the collapse of the peace agreement and resumption of hostilities, oil prices went up again. According to Oilprice.com, Brent Crude, the international benchmark, rose to $95/73 per barrel, while West Texas Intermediate (WTI) sold at $88.09 per barrel on Wednesday, July 22, 2026.
The resumption of naira-denominated sales at the Dangote Refinery is expected to improve product availability,
Victor Ezeja is a Nigerian journalist skilled in producing insightful news analyses, feature stories, and interviews that simplify complex issues and drive informed public discourse. His work combines rigorous research, balanced reporting, and compelling storytelling to highlight developments shaping industries and society. Victor, who holds a Master's Degree in Mass Communication, specializes in energy, aviation, business, and economic reporting. He can be reached via @VICTOREZEJA on X