Fuel Supply Fears Rise as Dangote Refinery Halts Petrol Loading, FG Moves to Secure Crude

Fresh concerns over a possible fuel shortage are emerging after the Dangote Petroleum Refinery temporarily halted the loading of petrol, even as the Federal Government moves to secure additional crude oil supplies to keep the facility running.

Sources within the oil industry revealed that the Federal Government, through the Nigerian National Petroleum Company Limited (NNPCL), has begun efforts to source crude oil from third-party international traders to sustain refining operations at the $20 billion refinery located in Lekki.

According to insiders, the national oil company is leveraging its global trading network to obtain crude supplies amid ongoing challenges with local allocations. However, officials cautioned that the intervention may not immediately lead to a drop in petrol prices.

The development comes at a time when Nigerians are already struggling with rising fuel costs following recent price adjustments by the refinery.

Within the past week, petrol gantry prices reportedly jumped from ₦774 to about ₦995 per litre, pushing retail pump prices beyond ₦1,000 per litre in several states. In some areas, filling stations are now selling petrol for as much as ₦1,200 per litre, increasing the financial strain on households and businesses.

Oil marketers also confirmed that the refinery recently suspended the loading of Premium Motor Spirit (PMS), sparking fears that another price hike could be on the horizon.

Industry analysts attribute the situation partly to escalating geopolitical tensions in the Middle East, particularly the ongoing conflict involving Iran, the United States, and Israel.

The crisis has driven the price of Brent crude above $92 per barrel and disrupted global energy supply chains. Rising tensions around the Strait of Hormuz—a key global energy shipping route—have also contributed to the spike in crude oil prices.

A senior NNPCL official confirmed that the company is actively sourcing crude through international traders to ensure the refinery continues operations.

“Leveraging our global crude trading network, we are sourcing third-party crude for the refinery at prices competitive with prevailing international market rates,” the official said.

He added that the national oil company remains committed to supporting local refining capacity.

“As the national oil company entrusted with safeguarding Nigeria’s energy security, NNPC Limited remains fully committed to supporting domestic refining, including the Dangote Petroleum Refinery,” he said.

The refinery has previously raised concerns over difficulties in securing adequate domestic crude supply.

Under the government’s naira-for-crude policy, the refinery is expected to receive about 13 cargoes of crude oil monthly from NNPCL. However, it reportedly receives only about five cargoes, forcing it to import additional crude at international market prices.

A refinery source noted that the broader global energy crisis is also influencing fuel prices worldwide.

“The ongoing Middle East crisis is affecting global energy prices, including crude oil and LNG, and this inevitably impacts refined product pricing across markets,” the source said.

Energy experts say improving domestic crude supply could help stabilise petrol prices in Nigeria.

The National Publicity Secretary of the Crude Oil Refinery Owners Association of Nigeria, Eche Idoko, said full implementation of the naira-for-crude policy would help moderate fuel costs.

“Dangote requires about 14 cargoes of crude monthly from the government under the naira-for-crude policy to meet its operational demand,” Idoko explained.

He warned that continued reliance on imported crude would likely push additional costs to consumers.

Meanwhile, the Chief Executive Officer of Petroleumprice.ng, Jeremiah Olatide, said restrictions on petrol import licences have strengthened the refinery’s influence in the market.

According to him, roughly 90 per cent of marketers who applied for petrol import permits were denied approvals.

“Imports should ideally account for only about 20 to 25 per cent of supply, while the majority should come from local refining. That balance would strengthen the economy and enhance energy security,” he said.

Data from global analytics firm Kpler also shows a sharp rise in Nigeria’s crude imports from the United States. Imports increased to 41.13 million barrels in 2025, up from 15.79 million barrels in 2024—representing a 161 per cent increase.

The surge highlights Nigeria’s growing dependence on imported crude despite being Africa’s largest oil producer.

Amid the supply pressure, the Dangote refinery has also expanded its network of petroleum marketers to sustain product distribution across the country.

Approved distribution partners have increased from 13 companies to more than 30 nationwide, including NIPCO Plc, MRS Oil Nigeria Plc, TotalEnergies Marketing Nigeria Plc and Conoil Plc.

Analysts believe the move is aimed at strengthening distribution channels while navigating supply challenges and volatile global oil prices.

With petrol now selling between ₦1,030 and ₦1,100 per litre in major cities, transport fares and the cost of goods are already rising across the country.