The Nigerian National Petroleum Company Limited has expanded its crude oil allocation to the Dangote Petroleum Refinery and Petrochemicals, assigning seven shipments for delivery in May in a bid to strengthen local fuel output.
Information obtained from two market insiders and reported by Reuters on Tuesday indicates that the new allocation exceeds the five shipments the refinery had consistently received in prior months. Despite this increase, the volume scheduled for April is expected to remain unchanged at five cargoes.
This adjustment comes at a period when Nigeria is facing persistent fuel supply challenges alongside rising petrol costs nationwide. The refinery has struggled to secure enough crude oil within the country, limiting its ability to operate at full capacity.
Details from the report reveal that while the allocation for May represents a slight improvement, it still falls significantly short of the refinery’s requirements. The facility had previously disclosed that domestic supply averaged about five cargoes monthly, whereas it needs between 13 and 15 cargoes to function efficiently. This gap has forced the refinery to turn to international markets, where crude prices are influenced by global events, including geopolitical instability in the Middle East.
At the time of reporting, representatives of both the NNPC and the Dangote refinery had yet to issue official statements regarding the development.
The increase is consistent with earlier indications that the Federal Government, through the NNPC, has been making efforts to improve crude availability for the refinery under ongoing supply arrangements aimed at boosting local refining capacity. Sources within the industry disclosed in early March that the national oil firm has been tapping into its global trading connections to procure crude oil from external suppliers at competitive rates.
A senior official within the NNPC, who requested anonymity due to restrictions on speaking publicly, emphasized that the organization remains committed to ensuring Nigeria’s energy stability. The official noted that the company continues to support domestic refining operations, including the Dangote facility, even as it navigates temporary supply constraints.
In spite of the revised allocation, the refinery which has a processing capacity of 650,000 barrels per day continues to face a substantial deficit in crude supply. The current volumes remain well below what is needed for optimal production levels.
As a result, the refinery has had to depend partly on imported crude, exposing it to unpredictable global price movements. These fluctuations are largely driven by international tensions, particularly conflicts affecting oil-producing regions.
Nigeria has experienced a steady rise in fuel prices in recent months, driven by limited supply and the high cost of sourcing petroleum products. Although the Dangote refinery has increased its contribution to the domestic fuel market, it currently meets slightly more than two-thirds of the country’s estimated daily consumption of 60 million litres.
In response to escalating costs, the refinery recently adjusted its depot prices upward by about 13 percent, adding further pressure to the already strained downstream sector.
