The Independent Petroleum Marketers Association of Nigeria (IPMAN) has criticized depot owners and filling station operators for stockpiling petrol in anticipation of a price hike. This comes after Dangote Petroleum Refinery suspended the sale of petroleum products in naira, citing foreign exchange challenges.
Following the refinery’s decision, some filling stations began hoarding petrol, expecting prices to rise due to the uncertainty surrounding the Federal Government’s crude supply agreement with Dangote. However, IPMAN has warned against panic buying, stressing that it could lead to significant losses if prices drop.
Last week, Dangote Refinery announced it had temporarily stopped selling in naira due to a mismatch between its crude oil purchase costs, which are in US dollars and its sales revenue. The refinery explained that the amount of crude oil it received in naira was not enough to cover its operations, making it necessary to adjust its sales policy.
The refinery’s announcement immediately impacted the market, causing the cost of petrol loading at private depots in Lagos to rise from less than ₦850 per liter to around ₦900 per liter. Some depot owners reportedly increased prices to maximize profits, leading to speculation and panic buying by marketers.
IPMAN’s National Publicity Secretary, Chinedu Ukadike, condemned depot owners for taking advantage of the situation. He advised marketers to avoid stockpiling, warning that a potential price drop could result in financial losses. Ukadike emphasized that when Dangote resumes selling in naira, depot owners who bought at high prices might struggle to recover their investments.
Meanwhile, the Federal Government and Dangote Refinery have resumed discussions on reviving the naira-for-crude deal. Sources within the petroleum industry confirmed that a technical committee is reviewing possible solutions to ensure the continuation of crude sales in naira.
Industry experts have raised concerns that suspending naira sales could put additional pressure on Nigeria’s foreign exchange market, as petroleum marketers will now require more US dollars to purchase products. The Nigerian National Petroleum Company Limited (NNPCL) has also been criticized for its extensive forward sales of crude oil, which have reduced available supply for local refineries.
In response, NNPCL spokesperson Olufemi Soneye confirmed that fresh negotiations are underway to renew the naira-for-crude agreement. He revealed that 48 million barrels of crude had been supplied to Dangote Refinery since October 2024, and discussions are ongoing ahead of the expiration of the initial agreement.
Experts believe that the naira-for-crude arrangement previously helped stabilize petrol prices and prevent excessive hikes. They warn that without it, the naira could face further devaluation as oil marketers scramble for foreign exchange to import fuel.