Demand for the United States Dollar is expected to increase across major markets in Nigeria following the Dangote Refinery’s decision to stop selling petroleum products in Naira due to its inability to secure crude oil in local currency.
The refinery, which has a capacity of 650,000 barrels per day, has struggled to obtain crude from local producers under the naira-for-crude deal with NNPC Limited.
The agreement was designed to ensure a steady supply of crude oil in exchange for refined products, but delays in execution have forced the company to adjust its sales strategy.
The shift is expected to put pressure on foreign exchange markets as petroleum marketers and importers seek dollars to purchase refined products.
The Naira declined further in the foreign exchange market, closing at N1,532.94 per dollar in the official window and N1,590 per dollar in the parallel market.
Industry stakeholders warn that the decision could lead to higher petrol prices, as businesses forced to buy in dollars will pass the cost on to consumers.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) has urged the government and NNPC to resume crude supply to Dangote Refinery in Naira, warning that failure to do so could destabilize fuel supply and increase costs nationwide.
Despite concerns, Dangote Refinery has assured customers that it will resume naira sales once crude allocations in local currency are received, but the timeline remains uncertain as negotiations continue.
