FG says naira-for-crude oil deal will continue

The federal government says the naira-for-crude oil deal will continue after the first phase ended on March 31.

The ministry of finance announced on Monday, after a meeting between the technical sub-committee on the crude and refined product sales in naira initiative, Wale Edun, minister of finance, and Zacch Adedeji, the chairman of the committee and the executive chairman of the Federal Inland Revenue Service (FIRS).

Also at the meeting are representatives of Dangote Petroleum Refinery and Dapo Segun, the chief financial officer of Nigerian National Petroleum Company (NNPC) Limited, the coordinator of NNPC refineries; management of NNPC Trading; and senior officials from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

Senior officials from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the Central Bank of Nigeria (CBN), the Nigerian Ports Authority (NPA), representatives of the African Export-Import Bank (Afreximbank), and the secretary of the committee, Hauwa Ibrahim, were also at the meeting.

“The stakeholders reaffirmed the government’s continued commitment to the full implementation of this strategic initiative, as directed by the Federal Executive Council (FEC),” the ministry said.

“Thus, the Crude and Refined Product Sales in Naira initiative is not a temporary or time-bound intervention, but a key policy directive designed to support sustainable local refining, bolster energy security, and reduce reliance on foreign exchange in the domestic petroleum market.

“As with any major policy shift, the Committee acknowledges that implementation challenges may arise from time to time.”

The ministry said the issues are being actively addressed through coordinated efforts among all parties.

“The initiative remains in effect and will continue for as long as it aligns with the public interest and supports national economic objectives,” the ministry said.

The sale of crude oil and refined petroleum products in naira to local refineries commenced on October 1, 2024, to improve supply, save the country millions of dollars in petroleum products imports, and ultimately reduce pump prices.

On March 10, TheCable reported that the NNPC had halted the naira-for-crude deal until 2030, as the government-owned company has forward-sold all its crude oil.

Nine days later, the Dangote refinery said it had temporarily halted the sale of petroleum products in naira.

The refinery said the decision to halt sales in naira was “necessary to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in U.S. dollars”.