CORAN says petrol could drop below N400 if naira-for-crude policy is restored, warning of rising prices despite crude crash

[dropcap]T[/dropcap]he Crude Oil Refinery Owners Association of Nigeria (CORAN) has issued a stark warning that petrol prices could continue to surge despite a significant drop in global crude oil prices, unless the Federal Government reinstates and sustains the naira-for-crude policy.

Also read:‘National budget already affected’ What does oil price crash mean for Nigeria?

Speaking in a detailed interview, CORAN’s Publicity Secretary, Eche Idoko, expressed deep concern that local refiners are being sidelined while middlemen profit, leading to inflated fuel prices that do not reflect current crude market realities.

According to Idoko, without immediate intervention, Nigerians could be paying over N1,000 per litre in the coming months.

“Crude oil prices have dropped significantly — Brent crude is down to $65 per barrel, the lowest since 2021 — yet Nigerians are paying close to N970 per litre for petrol,” he said.

“If the naira-for-crude initiative had been fully sustained, we would be seeing prices around N350 per litre.”

CORAN believes that fuel should cost less than N400 per litre if crude oil prices drop to $50 per barrel.

However, factors such as the weakening naira, foreign exchange volatility, logistics costs, and the influence of middlemen are pushing petrol prices in the opposite direction.

Despite a drop in petrol landing costs from N885 to N865 per litre, ex-depot prices have risen from N860 to N900 in Lagos, further disconnecting retail prices from global market trends.

Idoko attributes this price distortion to the continued reliance on foreign imports and the undermining of local refining capacity by vested interests.

“The naira-for-crude policy was a bold move that brought some relief,” he added. “When it was implemented, prices were heading downwards. But the moment it became uncertain, prices shot up again.”

Idoko also lamented that Nigerian refiners are being forced to source crude from foreign producers just to keep their plants operational.

He stressed that the failure to supply crude locally in naira amounts to sabotaging energy security and undermining the investments made by indigenous refiners.

Trade tensions between the United States and China, rising tariffs, and a hasty decision by OPEC+ to accelerate production increases have shaken global oil markets.

Brent fell below $65 per barrel, while US West Texas Intermediate crude dropped to $61.99 per barrel — a 7.4% decline — following new Chinese tariffs on American goods.

However, Nigerian consumers have seen no benefit. Instead, they face rising pump prices amid continued naira depreciation and alleged manipulation of the market by middlemen with no long-term stake in refining or infrastructure.

According to Idoko, these intermediaries are sabotaging the future of local refining. “They don’t invest, they don’t take risks, they just profit from connecting Nigerian consumers to international traders.

That’s why fuel prices remain high — even when every economic indicator says they should be falling.”

He urged President Bola Tinubu’s administration to consider the long-term benefits of local refining and to sustain policies like the naira-for-crude deal that promote price stability and energy independence.

S&P Global recently reported that although the Nigerian National Petroleum Company Limited (NNPC) agreed to supply 385,000 barrels per day to the Dangote refinery in naira, only 280,000 b/d was delivered by March 10 — far short of the deal’s target.

The refinery has since suspended sales of naira-priced fuel, leading to another wave of price hikes nationwide.

Also read:Tinubu orders naira crude sale, marketers project price crash

With the six-month pilot agreement now expired and uncertainty looming over its renewal, industry stakeholders are calling on the government to act swiftly before the fuel crisis escalates further.