The Federal Government and Dangote Petroleum Refinery have reached a breakthrough agreement under which dollars will be supplied to the refinery in exchange for naira proceeds from petrol sales. A senior company executive, who asked not to be identified because of the sensitivity of the matter, said the deal was concluded on Friday, July 31, 2026.
Under the arrangement, the government will provide foreign exchange to cover the hard-currency cost of crude oil imports, while the refinery continues to sell premium motor spirit (petrol) to Nigerian consumers in naira. The move is intended to revive a naira-for-crude scheme that has been on the brink of collapse.
Why Dangote halted naira sales
The refinery had earlier suspended naira-denominated fuel sales after the Central Bank of Nigeria failed to convert naira receipts into dollars. Despite paying for crude in U.S. currency, Dangote was not receiving hard currency from the CBN for the petrol it sold in naira, creating an unsustainable financial burden.
"As you know, we had earlier stopped selling in naira as we were not getting the dollars from the Central Bank of Nigeria for the products we sold for naira, even though we had paid in US dollars for the crude. Now, we have been assured that we will be given the dollars," the official said.
Crude shortfall driving the crisis
At the heart of the problem is a shortfall in crude deliveries under the naira-for-crude scheme. The programme was designed to supply approximately 13 million barrels of crude to the refinery every month. In reality, monthly deliveries fell to around four million barrels, forcing Dangote to purchase the difference on the international market in dollars.
The cost of bridging that gap has been enormous. According to the refinery, it imported 40.40 million barrels of crude between May and June 2026, spending roughly $4.48 billion. May saw 21.47 million barrels arrive at a landed cost of $2.68 billion, while June brought 18.93 million barrels worth $1.80 billion.
Naira-for-crude scheme's turbulent history
The naira-for-crude arrangement was first proposed by President Bola Tinubu during a Federal Executive Council meeting on July 29, 2024. The Federal Executive Council adopted the proposal, selecting Dangote refinery as the pilot participant, covering 450,000 barrels earmarked for local consumption.
The scheme has faced repeated setbacks. In the first quarter of 2025, the Nigerian National Petroleum Company Limited suspended its involvement, which again triggered a halt in naira fuel sales. The Federal Government later intervened and ordered the continuation of the programme indefinitely.
Dangote vs NNPCL on crude supply
The latest dollar swap agreement comes as Dangote pushes back against claims by NNPCL that it fully honoured its obligations under the naira-for-crude programme. A senior executive at Dangote Group said the refinery received only three of the 14 cargoes it had expected under the supply framework – fewer than 25 percent.
NNPCL spokesman Andy Odeh, however, told PUNCH that the company had supplied every available naira-denominated crude cargo to Dangote Refinery and withheld none.
Federal Government officials had not responded to requests for further comment on the new dollar swap deal at the time of writing.
