Nigeria’s largest privately owned refinery, the Dangote Petroleum Refinery, has reassured Nigerians that it will prioritise the domestic supply of refined petroleum products to prevent fuel scarcity in the country despite the ongoing crisis in the Middle East.
In a statement issued on Thursday, March 5, the company said it remained committed to serving as a stabilising force for Nigeria’s energy market amid global supply disruptions triggered by the conflict in the region.
According to the refinery, the crisis has led to the shutdown of some refineries across several countries, resulting in reduced refining output and tightening global supply of petroleum products.
The company noted that international supply chains have also come under pressure following a ban on the export of gasoline and diesel by China.
It explained that these developments have significantly strained the global petroleum products market, contributing to rising fuel prices and increased uncertainty in energy markets worldwide.
Despite the situation, Dangote Refinery said it would ensure that Nigeria is shielded from the impact by prioritising supply to the domestic market.
“This is one of the many benefits of domestic refining,” the company stated, adding that large-scale local refining reduces the country’s vulnerability to international supply disruptions.
The refinery explained that the conflict has pushed global crude oil and freight prices sharply higher in recent weeks.
It said the benchmark Brent Crude had surged by about 26 per cent within a short period to above $84 per barrel.
In response to the rising costs, the refinery said it implemented a measured adjustment of ₦100 per litre in its ex-depot price of Premium Motor Spirit (PMS), representing an increase of about 12 per cent.
However, the company stressed that it had absorbed about 20 per cent of the cost escalation in order to cushion the impact on consumers in the domestic market.
Crude Landing Cost Rises To $91 Per Barrel
The refinery explained that it continues to source crude oil at prevailing international market prices, whether the crude is purchased locally or from foreign suppliers.
According to the company, Nigerian crude oil is typically priced between $3 and $6 per barrel above the Brent benchmark, while freight costs add about $3.50 per barrel.
“As a result, crude oil is currently landing in our tanks at between $88 and $91 per barrel,” the statement said.
It added that crude previously landed at about $68 per barrel when the refinery’s ex-depot price stood at ₦774 per litre.
Crude Supply Shortfall From NNPC
The company further disclosed that it receives about five crude cargoes monthly from the Nigerian National Petroleum Company Limited, which are paid for in naira.
However, it said the volume falls significantly short of the 13 cargoes required each month to meet local refining demand.
The refinery said the shortfall had forced it to source additional crude oil from international traders using foreign exchange obtained at open market rates.
It also blamed upstream producers for failing to supply crude oil in line with provisions of the Petroleum Industry Act, a development it said had compelled it to rely heavily on international traders who charge additional premiums.
Despite the challenges, the company maintained that large-scale domestic refining remains critical to reducing Nigeria’s exposure to global supply shocks.
According to the refinery, local refining helps moderate foreign exchange demand and prevents severe fuel shortages during periods of international instability.
The company also revealed that it is accelerating the deployment of Compressed Natural Gas-powered trucks to improve nationwide distribution of petroleum products.
It said the rollout of the trucks, scheduled to commence this month, would help reduce logistics costs and improve delivery timelines across the downstream sector.
The refinery reaffirmed its commitment to transparency, operational efficiency and long-term energy stability for the country.
It stressed that its goal remains ensuring sustainable energy security and stable fuel supply for Nigerians at an affordable cost, even amid global market volatility.