Dangote Petroleum Refinery has cautioned that crude oil sold by local producers at prices above international market rates threatens the financial logic of domestic refining and could eventually drive up pump prices for Nigerian consumers.
Refinery's Concern Over Crude Pricing
Devakumar Edwin, Group Vice President for Oil, Gas and Fertiliser at Dangote Industries Limited, made the clarification in response to data published by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which showed the refinery rejected 15.5 million barrels of crude offered by domestic producers in the second quarter of 2026.
Edwin argued that the NUPRC figures did not tell the full story, saying the statistics failed to distinguish between crude that is formally allocated on paper and volumes that are genuinely available on commercially competitive terms.
Dangote's Position on Crude Supply
According to Edwin, the refinery has faced persistent difficulties securing sufficient Nigerian crude directly from domestic producers since the Domestic Crude Supply Obligation (DCSO) framework took effect.
"Our position is straightforward. We are ready and willing to purchase Nigerian crude oil, provided it is available in sufficient volumes and at competitive market prices," Edwin said.
He said the refinery must buy crude at prices that make operations financially sustainable, and that this directly affects what Nigerian consumers eventually pay for petroleum products.
Impact on Fuel Prices
Edwin added that a large share of the refinery's crude supply under the DCSO arrangement has had to come through International Oil Companies (IOCs) and other third parties, because direct purchases from domestic producers have proved difficult to secure. Those extra transaction layers, he said, typically introduce premiums and additional costs that can push the price of Nigerian crude above what the refinery could pay for alternative supplies on the international market.
NUPRC's Q2 DCSO statistics showed that the Dangote Refinery required 63 million barrels during the quarter, while domestic producers offered a higher volume of 68.1 million barrels. On the surface, the figures suggest supply was not the problem. Edwin's response, however, centres on price rather than volume, with the refinery insisting that being offered crude is meaningless if the terms attached make domestic sourcing commercially unworkable.
