To stabilize the price of refined fuel at the pump and the dollar-Naira exchange rate, President Bola Tinubu has directed the Nigerian National Petroleum Company Limited (NNPC) to sell crude oil to Dangote Refinery and other new refineries in Naira.
Bayo Onanuga, the President’s Special Advisor on Information and Publicity, made the news on Monday on his official X handle. Onanuga claims that the Federal Executive Council (FEC) approved this direction at today’s meeting. The Dangote Refinery currently needs 15 cargoes of crude each year, which comes to about $13.5 billion. Four cargoes have already been committed to by NNPC.
The Dangote Refinery would be the first beneficiary of this strategy, with the FEC having approved the sale of the 450,000 barrels allotted for domestic consumption in Naira under the new directive.
Afreximbank and other Nigerian settlement banks will facilitate transactions between Dangote Refinery and NNPC Limited as part of the move to stabilize the exchange rate for this transaction. It is anticipated that this tactic will do away with the requirement for foreign letters of credit, therefore cutting the nation’s dollar expenses.
Through the provision of a more stable and predictable environment for domestic refineries, this intervention constitutes a substantial shift in policy that could have an impact on the Nigerian oil sector and the country’s overall economic landscape.
Gentle Reminder: Be careful how you use your authority and influence, be wise, and treat others with respect.
Chychy Jonas
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