NNPC raises crude allocations to Dangote Refinery to boost domestic fuel production amid high petrol prices and limited local supply

The Nigerian National Petroleum Company Limited (NNPC) has increased crude oil allocations to the Dangote Petroleum Refinery and Petrochemicals, assigning seven cargoes for May loading in a bid to boost domestic fuel production.

Also read: NNPC moves to boost crude amid rising oil prices

Two industry sources told Reuters on Tuesday that the latest allocation marks a rise from the five cargoes the refinery previously received, although it will continue to receive five cargoes in April.

The move comes amid soaring petrol prices across Nigeria, as the refinery struggles to secure sufficient local crude.

The Dangote facility, with a 650,000-barrels-per-day capacity, requires between 13 and 15 cargoes monthly to operate at full capacity, but domestic supply has consistently fallen short, forcing reliance on imported crude at volatile international prices.

“Leveraging our global crude trading network, we are sourcing third-party crude for the refinery at prices competitive with prevailing international market rates,” a senior NNPC official, speaking on condition of anonymity, told reporters.

“NNPC remains fully committed to supporting domestic refining, including the Dangote refinery, despite temporary availability constraints.”

The refinery began operations in 2024 and has significantly increased petrol supply to the domestic market, currently meeting just over two-thirds of Nigeria’s estimated daily demand of 60 million litres.

However, supply constraints and high import costs have contributed to record fuel prices, prompting the refinery to raise petrol depot prices by about 13 per cent.

Industry analysts note that diverting more crude to domestic refining could affect Nigeria’s crude export volumes.

With global supply tight due to Middle East tensions, reduced exports may prompt international buyers to seek alternative sources, potentially impacting Nigeria’s standing in the global market.

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Sustained domestic crude supply remains critical for the refinery to operate optimally, stabilise fuel prices, strengthen energy security, and reduce foreign exchange pressure.