There is tension in the downstream oil sector as players await the decision of the Nigerian government on the naira-for-crude deal between the National Petroleum Company Limited and the Dangote Refinery.

The six-month deal, which started in October last year, ends on March 31, 2025.

Petrol prices soar across Nigeria

Stakeholders are eagerly waiting for the deal's extension or a halt as the parties involved have yet to agree.

Following the delay in renewing the deal and the increase in crude oil prices, petrol prices have soared at filling stations nationwide.

Legit.ng earlier reported that prices have risen from N860 per litre to over N930 in one week.

Dealers have blamed the increase on the inability of the Nigerian government to extend the naira-for-crude deal between refineries and the NNPC.

Oil marketers predict new prices

Oil marketers have also projected further increases in petrol prices, saying the cost may hit N1,000 per litre in weeks if measures are not put in place to renew the deal, which has helped to check the increase in petrol prices.

Punch reports that the Dangote Refinery is expected to shut down its petrol-producing unit for maintenance.

Reuters reports that the maintenance may occur in June and will last 30 days.

Reports say NNPC recently said that Dangote Refinery received about 48 million barrels under the naira-for-crude deal.

NNPC spokesman, Olufemi Soneye, disclosed that the initial deal was for six months and discussions for the renewal were still ongoing to establish a new contract.

Dangote pauses petrol sale in naira

Legit.ng reported that the Dangote Refinery announced a halt in the sale of petroleum products in naira to marketers, leading to a hike in petrol prices.

Dangote Refinery’s announcement led to an increase in petrol prices in depots to N900 per litre from N850.

Retail stations also raised their pump prices in Lagos to N930, N950 in Abuja and N960 in the far North.

According to reports, the national publicity secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, said the reason for the price increase was due to the collapse of the deal.

He said stakeholders have convened a meeting to chart a way forward.

IPMAN’s vice president, Hammed Fashola, said that Nigerians might revert to buying petrol at N1,000 per litre if the naira-for-crude agreement is jettisoned.

Fashola described the price hike as unfortunate, asking depot owners and marketers under the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) to reconsider their new price offerings.

Marketers predict N1,000 per litre as new price

He said the NNPC and Dangote Refinery may officially release new petrol prices after the holidays.

The IPMAN VP said prices may hit N1,000 in the coming days, saying the naira-for-crude deal could have been a game changer.