Independent petroleum marketers and energy experts have rejected the Dangote Petroleum Refinery’s decision to price petroleum products in United States dollars, warning that the policy could trigger fresh pressure on Nigeria’s foreign exchange market, drive up fuel prices and destabilise the downstream petroleum sector.
The stakeholders described the move as a major setback to efforts aimed at strengthening the naira and promoting local currency transactions within Nigeria’s oil and gas industry.
They argued that compelling marketers to source dollars before purchasing refined products would significantly increase demand for foreign exchange, worsen exchange rate volatility and inflate the cost of doing business.
According to the marketers, many independent operators rely on the naira for their daily transactions and may struggle to access sufficient foreign currency to sustain operations. They cautioned that the development could force smaller marketers out of the market, reduce competition and ultimately leave consumers bearing the burden through higher pump prices.
Energy analysts also warned that dollar-denominated fuel sales could have a ripple effect across the economy by increasing transportation costs, production expenses and the prices of goods and services.
They noted that the policy comes at a time when Nigerians are already grappling with rising inflation and the high cost of living.
The Dangote Petroleum Refinery defended the decision, explaining that it became necessary due to challenges associated with sourcing crude oil, which is largely purchased in U.S. dollars, as well as fluctuations in the foreign exchange market. The company maintained that aligning its sales currency with its procurement obligations would help ensure operational sustainability.
Industry stakeholders, however, urged the Federal Government to intervene by strengthening the naira-for-crude initiative and guaranteeing adequate crude oil supply to domestic refineries.
They argued that local refining was established to reduce Nigeria’s dependence on imported petroleum products and conserve scarce foreign exchange, not to increase demand for dollars.
The controversy has reignited debate over the future of Nigeria’s downstream petroleum industry, with economists warning that unless urgent measures are taken to stabilise crude supply and protect the local currency, the new pricing regime could further strain businesses, consumers and the nation’s economy.
