Dangote Petroleum Refinery, one of Nigeria’s largest oil refineries, has announced the temporary suspension of the sale of petroleum products in Naira. This decision, according to a statement from the refinery, is aimed at preventing a mismatch between the company’s sales proceeds and its crude oil purchase obligations, which are currently denominated in U.S. dollars.
The move comes as the refinery seeks to address a significant issue regarding its crude oil procurement and product sales. As of now, Dangote Refinery has reportedly sold more petroleum products in Naira than the value of Naira-denominated crude oil it has received. This imbalance has prompted the company to make a temporary adjustment to align its sales currency with the currency in which it procures its crude oil.
In the statement issued by the refinery’s management on March 19, 2025, Dangote Refinery explained that the decision was necessary to ensure that the company’s sales and procurement processes are synchronized. With crude oil purchases being made in U.S. dollars, continuing sales in Naira created a financial mismatch, which the company sought to avoid through this temporary suspension.
The refinery stressed that it was not halting operations due to any technical or operational failures, despite rumors circulating on social media about alleged fraud related to ticketing. According to Dangote Refinery, these claims are false, and there have been no incidents of fraud affecting the refinery’s operations. The company clarified that its systems are robust and have been functioning without any issues.
Dangote Refinery assured its customers that the suspension is temporary. The company emphasized that it remains committed to serving the Nigerian market and will resume sales in Naira as soon as it receives an allocation of Naira-denominated crude cargoes from the Nigerian National Petroleum Corporation (NNPC). This would allow Dangote Refinery to align its crude oil purchases with the sales proceeds, enabling the company to resume operations as usual in the local currency.
While the suspension is expected to affect the sale of petroleum products in Naira temporarily, the refinery assured its customers that it would continue to operate efficiently and sustainably during this period.
Dangote Refinery, owned by Nigerian billionaire Aliko Dangote, is a major player in Nigeria’s oil and gas industry. The refinery, which is one of the largest single-train refineries in the world, is designed to significantly reduce Nigeria’s reliance on imported petroleum products. As Nigeria is one of the largest oil producers in Africa, the refinery is expected to play a key role in the country’s efforts to meet its domestic fuel demands and even export refined products.
However, the country’s oil sector has long been faced with challenges such as foreign exchange fluctuations, crude oil pricing volatility, and difficulties in securing consistent supplies of refined products. These issues have placed a significant strain on Nigeria’s oil market and have made it challenging for companies like Dangote Refinery to operate smoothly, especially in a country where the value of the Naira has been under constant pressure.
For Dangote Refinery, the decision to align its sales currency with its crude oil procurement currency reflects the financial challenges the company faces. The refinery’s operations are heavily dependent on crude oil imports, and fluctuations in foreign exchange rates, particularly in the Naira, have made it difficult for the company to maintain a balanced financial structure.
The suspension of sales in Naira is likely to have a significant impact on the Nigerian fuel market. As one of the largest refineries in the country, Dangote Refinery plays a critical role in supplying refined petroleum products, such as petrol, diesel, and kerosene, to Nigeria. Any disruption in its operations could lead to supply shortages, which may affect fuel availability and prices across the country.
Consumers may also feel the effects of this decision in the short term, especially as they may need to adjust to different payment methods or face potential delays in the purchase of fuel products. However, the refinery has assured the public that it will resume sales in Naira once it has aligned its crude procurement and product sales processes.
Furthermore, this decision highlights the challenges faced by the Nigerian government and the private sector in managing the country’s oil sector amidst the global price fluctuations and the volatility of the Naira. Nigeria’s dependence on imported fuel, despite being a major oil producer, continues to put pressure on the country’s foreign exchange reserves and fuel pricing mechanisms.
Dangote Refinery also addressed rumours circulating on social media that the suspension was due to an alleged incident of ticketing fraud. The refinery’s management was quick to dismiss these claims, stating that they were completely false. According to the company, its systems are robust and there have been no issues related to fraud affecting operations.
The refinery took the opportunity to reassure its customers that the decision to halt sales in Naira was made purely for financial reasons and was not related to any internal fraud or operational failures. This statement is likely aimed at curbing any concerns or misinformation that may have caused unease among customers and stakeholders.
Despite the temporary suspension, the future of Dangote Refinery remains positive, with the company’s long-term goals focused on ensuring that Nigeria becomes self-sufficient in its petroleum product needs. Once the refinery is fully operational, it is expected to significantly reduce the country’s reliance on imported fuel, which has been a major challenge for the Nigerian economy.
As Dangote Refinery continues to navigate the complexities of the Nigerian fuel market, it is expected that the company will remain committed to finding solutions to the challenges it faces, including addressing issues related to foreign exchange, crude oil procurement, and sales in local currency.
The refinery’s management has reassured its customers that it remains dedicated to providing high-quality products and services and will continue to work closely with NNPC and other stakeholders to ensure the smooth operation of the refinery in the future.
