Dangote Refinery Turns to U.S. Oil Amid Local Supply Shortages

Aliko Dangote, president of the Dangote Group, recently shared that his refinery has been importing more crude oil from the United States in recent months. He explained this is due to a shortage of locally available crude, despite Nigeria being a major oil-producing country.

Dangote made the statement during a visit by the technical committee from the “one-stop shop” (OSS) team, which supports the government’s naira-for-crude initiative. He stressed that bold investment in key sectors like energy is vital for Nigeria’s industrial growth.

He also highlighted the scale of investment behind the refinery, noting it includes advanced infrastructure such as a marine terminal that can receive the world’s largest ships.

During the visit, Dangote praised the OSS committee for backing President Bola Tinubu’s naira-for-crude policy. He said the initiative has helped cut fuel prices, reduce demand for U.S. dollars, and steady the value of the naira.

Maureen Ogbonna, head of the OSS delegation, described the Dangote Refinery as a major positive force in Nigeria’s economy, with an impact across various sectors.

Government Reviewing the Naira-for-Crude Policy

After the refinery visit, top government officials and industry regulators held talks as part of the Federal Executive Council’s steering committee. The goal was to push forward Nigeria’s energy reforms and make the market more self-reliant.

According to a statement from the Ministry of Finance, Minister Wale Edun attended the session alongside senior leaders from key institutions like the NNPC, Central Bank, Nigerian Ports Authority, and oil sector regulators.

The meeting reinforced the importance of continued collaboration through the OSS platform and focused on how to improve the crude-for-naira policy. The plan is seen as a way to strengthen Nigeria’s foreign exchange market, support local businesses, and reduce dependence on imported fuel.

The policy was officially launched on October 1, 2024, after the government directed the NNPC to sell crude oil in naira to Nigerian refineries. But by November, Dangote Refinery reported difficulties with the arrangement due to limited crude supply.

On March 10, reports showed the NNPC had suspended the deal until 2030 because it had already committed its oil to forward contracts. Nine days later, the Dangote Refinery paused its naira-based sales as well, saying it needed to avoid conflicts between its dollar-based expenses and naira-based revenues.

However, on April 9, the federal government said the policy would continue after March 31, when the first phase ended. Then, on May 9, Minister Edun confirmed that more updates on the initiative would be shared soon.