• Marketers warn of supply disruptions
Petroleum marketers have raised concerns over a potential shake-up in the downstream sector following Dangote Refinery’s decision to stop selling petrol in naira.
Expressing shock over the development, marketers warned that the move could disrupt supply chains and trigger price increases, further straining businesses and consumers.
In a statement, Dangote Refinery explained that the decision was necessary to align its sales revenue with crude oil purchase obligations, which are currently denominated in US dollars.
“So far, our naira-denominated petroleum product sales have exceeded the naira value of crude oil we received. As a result, we must temporarily adjust our sales currency to match our crude procurement currency.
“Additionally, reports suggesting we have halted loading due to a ticketing fraud incident are entirely false. Our systems are robust, and no such fraud has occurred.
“We remain committed to serving the Nigerian market efficiently and sustainably. As soon as we receive naira-denominated crude allocations from NNPC, we will promptly resume sales in naira. We appreciate your understanding during this period,” the statement read.
The National President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Billy Gillis-Harry, described the development as shocking and warned that it could impact fuel availability, energy security, and pricing.
He acknowledged that Dangote Refinery had played a crucial role in stabilizing the supply chain, ensuring steady product availability. However, he cautioned that the refinery’s suspension of domestic sales in naira should not be exploited by importers to justify excessive price hikes.
Gillis-Harry also pointed out that Dangote’s shift to dollar transactions effectively sidelines local marketers, as domestic fuel pricing and sales are based on naira.
The federal government had, on October 1, 2024, announced that crude oil sales to Dangote Refinery and other local refineries would be conducted in naira. The move aimed to ease pressure on foreign reserves and stabilize the local currency. However, with Dangote Refinery now opting for dollar transactions, stakeholders fear renewed economic strain on the Nigerian market.
