The Federal Government has officially commenced the sale of crude oil and refined petroleum products in naira, starting from October 1, 2024. This groundbreaking initiative, designed to reduce pressure on the naira and enhance the domestic petroleum market, was confirmed by the Ministry of Finance in a statement on its official X (formerly Twitter) account on Saturday.
The statement read, "The Minister of Finance and Coordinating Minister of the Economy announced that, in line with the Federal Executive Council directive, the sale of crude oil and refined petroleum products in naira has officially commenced as of October 1, 2024."
The announcement followed a meeting of the Implementation Committee on October 3, 2024, which was chaired by the Minister of Finance. The meeting included key stakeholders, who affirmed that the initiative had been successfully launched.
This development is part of the Federal Executive Council’s approval to sell crude oil to local refineries and corresponding refined products in naira, a plan revealed last month by the Technical Sub-Committee on Domestic Sales of Crude Oil in Local Currency. The policy aims to streamline transactions, reduce currency pressures, and eliminate additional transaction costs.
Under this arrangement, the Nigerian National Petroleum Company (NNPC) is expected to supply 385,000 barrels per day (bpd) of crude oil to the Dangote Refinery, valued and paid for in naira. In return, the Dangote Refinery will supply petrol and diesel of equivalent value to the domestic market, all transactions occurring in naira.
Despite the announcement, representatives of Dangote and other refineries were reportedly uncertain whether the deal had officially commenced. Officials from Dangote Refinery, the Nigerian Upstream Petroleum Regulatory Commission, the Ministry of Finance, and NNPC did not comment on the matter when approached for clarification.
The naira-for-crude initiative is expected to boost domestic fuel supply, while helping to stabilize the naira and reduce the country's reliance on foreign currencies for transactions in the oil sector. According to government sources, diesel will be sold in naira to any interested buyers, while petrol will be sold exclusively to the NNPC, which will then distribute it to various marketers.
Among those in attendance at the meeting to finalize the implementation were the Minister of State for Petroleum (Oil), Heineken Lokpobiri, Special Advisers to the President on Revenue and Energy, Zaccheus Adedeji and Olu Verheijen, and top officials from Dangote Group and NNPC, including Group CEO Mele Kyari and CFO Umar Ajiya.
The initiative is expected to have significant implications for Nigeria’s energy market, as it marks a major shift in how the country conducts oil transactions, potentially impacting fuel pricing, distribution, and the overall economy.
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