In a significant move aimed at stabilising the naira and promoting local value addition in the oil and gas industry, Nigeria’s Federal Government is making meaningful strides through a renewed policy of domestic crude oil and refined product sales denominated in naira.

This milestone was underscored during a high-level follow-up meeting held in Abuja, chaired by the Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun. The session brought together key stakeholders across the petroleum value chain, including the Nigerian National Petroleum Company Limited (NNPCL), the Nigerian Midstream and Downstream Petroleum Regulatory Authority, and the Federal Inland Revenue Service (FIRS).

The meeting served as a review platform for the Crude and Refined Product Sales in Naira Initiative, a core component of President Bola Tinubu’s broader economic strategy. The aim: to boost local currency usage, reduce reliance on the US dollar, and create a more resilient energy economy.

Encouraging Early Signs of Progress

During the meeting, the NNPCL presented a detailed report highlighting crude oil volumes allocated for domestic refining. Complementing this, the Midstream and Downstream Petroleum Regulatory Authority shared updates on local production, with a spotlight on operations at the Dangote Petroleum Refinery and Petrochemicals.

Mr Edun praised the inter-agency collaboration driving the initiative forward. “The positive feedback we are seeing is a direct result of the synergy among our key economic and energy institutions. We are optimistic about what lies ahead,” he noted.

Also present were the Executive Chairman of FIRS, Mr Zacch Adedeji, Special Adviser to the President on Energy, Ms Olu Verheijen, and representatives from various regulatory agencies and refining companies. Together, they reaffirmed their commitment to the smooth and sustained rollout of this strategic policy.

A Policy Reinstated – And Revitalised

It’s worth noting that earlier in March 2025, the naira-for-crude agreement hit a temporary pause. The Dangote Refinery had announced a halt to selling refined products in naira, citing misalignment between sales revenues (in naira) and crude oil purchase obligations, which were still pegged in US dollars.

However, this impasse was short-lived. Just three weeks later, a policy reset under the leadership of the new NNPCL administration revived the naira-based agreement. The impact was almost immediate—petrol pump prices saw a notable decline to ₦915 per litre, signalling increased pricing stability.

In July 2024, the Federal Executive Council had already set the groundwork for this shift, directing the NNPCL to prioritise naira-based sales of crude to local refineries, including Dangote. This move, according to experts, not only eases pressure on foreign exchange reserves but also strengthens domestic energy security.

Looking Ahead

As Nigeria works to diversify its economy and reduce its dependence on oil exports, policies like the naira-for-crude initiative are proving essential. Beyond economic stabilisation, they also foster deeper local participation in the energy sector and help keep more value within the country’s borders.

With renewed momentum and strong political will behind it, this initiative could mark a turning point for Nigeria’s economic trajectory—bringing the naira back into focus, fuelling growth from within, and building a more self-reliant energy future.

Source: Punchng