The Independent Petroleum Marketers Association of Nigeria (IPMAN) has said that the Dangote Refinery suspension of petrol sales in Naira will lead to a significant increase in petrol prices in Nigeria.
The National President of IPMAN, Abubakar Shettima, who spoke to PREMIUM TIMES in an interview on Saturday morning, assured that the supply of petroleum products will not be affected, given the presence of a refinery in the country.
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He, however, noted that if the refinery starts selling petrol in dollars, prices will increase.
“Actually, just the way you see it, we have seen it. Yes, it will definitely affect the price. If he is selling through dollar, there will be an increase in price,” Mr Shettima said.
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Speaking further, Mr Shettima said he plans to convene a meeting with IPMAN’s National Executive Council (NEC) members on Monday to discuss the issue and its potential implications.
“Immediately I got the information from the mail he sent to us. I call my NEC members to come on Monday so that we can discuss. And then we have to go and see the management of Dangote so that we can sit down and discuss and see the implication.”
Asked if the decision will affect petrol supply, Mr Shettima said “No, it will not affect the supply since we have a refinery in the country, the supply will be normal,” he added.
The Dangote Refinery in a notice to its customers had earlier announced the suspension of petrol sales in Naira, effective 28 September.
According to the refinery, the decision was made due to the refinery selling petroleum products in excess of its Naira-Crude allocations, making it unsustainable to continue petrol sales in Naira.
It advised its customers with pending naira-based transactions to formally request a refund of their current payments.
Policy framework
In July last year, the Federal Executive Council (FEC) directed the Nigerian National Petroleum Company Limited (NNPC Ltd) to engage Dangote Refinery and other local refineries to resolve the dispute over the sale of crude oil to them.
The FEC, presided over by President Bola Tinubu, also directed that crude oil sales to the refineries be made in naira and that the refineries, located in Nigeria, sell their refined products to the Nigerian market in naira.
Last October, the Nigerian government said it officially commenced selling crude oil and refined petroleum products in Naira.
On 10 March, the NNPC Ltd said the contract for the sale of crude oil in Naira was structured as a six-month agreement, subject to availability, and expires at the end of March 2025. At the time, the NNPC said discussions were currently ongoing towards emplacing a new contract.
Reacting to reports alleging unilateral termination of the crude oil sale agreement between NNPC and Dangote Refinery, the Nigerian government on 11 March said the policy framework enabling the sale of crude oil in naira for domestic refining remains in force.
Previous suspension
On 19 March, the Dangote refinery announced the temporary suspension of sales of petroleum products in Naira.
The refinery said the decision is necessary to avoid a mismatch between its sales proceeds and its crude oil purchase obligations, which are currently denominated in dollars.
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In April, a meeting between a presidential delegation and officials of the Dangote refinery, the NNPC Ltd and other parties agreed to extend the policy of selling Nigerian crude to local refineries in naira.
The meeting also resolved that the policy, including the sale of the products obtained from such crude in naira, will not have a terminal date.
“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,” the finance ministry said at the time.
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