NAJA Urges FG to Ensure Crude Supply to Local Refineries as Fuel Prices Rise

The Nigeria Auto Journalists Association has called on President Bola Ahmed Tinubu to take decisive steps toward stabilising Nigeria’s fuel market by guaranteeing the direct supply of crude oil to domestic refineries, particularly the Dangote Refinery, as global tensions continue to unsettle energy prices.

In a statement issued on Thursday, the association warned that the rising cost of petrol, exacerbated by the ongoing crisis in the Middle East, poses a serious threat to economic stability and the welfare of Nigerians already grappling with inflationary pressures. NAJA argued that Nigeria must urgently insulate its downstream petroleum sector from external shocks by strengthening local refining capacity.

The association’s intervention comes amid heightened volatility in the international oil market, where geopolitical developments have continued to influence crude prices and, by extension, the cost of refined petroleum products. For Nigeria, a country paradoxically rich in crude oil yet heavily dependent on imported fuel, the situation has once again exposed structural weaknesses in the energy value chain.

NAJA noted that while recent policy measures by the federal government signal a willingness to address the crisis, more targeted interventions are required to achieve lasting stability. The group specifically referenced the government’s plan to distribute 100,000 Compressed Natural Gas (CNG) conversion kits nationwide, describing it as a commendable but insufficient response to the scale of the challenge.

According to the association, the CNG initiative represents a forward-looking approach to energy diversification, particularly within the transportation sector. However, it stressed that alternative fuel adoption alone cannot resolve the immediate pressures facing petrol consumers. Instead, NAJA maintained that ensuring the efficient operation of domestic refineries remains the most viable short-term solution.

Speaking on behalf of the association, its Chairman, Theodore Opara, urged the federal government to implement policies that would enable local refineries to access crude oil directly from the Nigerian National Petroleum Company Limited, preferably in naira. He argued that such a move would significantly reduce the exposure of domestic fuel production to fluctuations in the global oil market.

Opara pointed out that the current arrangement, under which the Dangote Refinery imports a substantial portion of its crude feedstock, undermines the refinery’s potential to stabilise local fuel prices. He explained that reliance on imported crude effectively ties domestic refining operations to international pricing dynamics, thereby limiting the benefits of local production.

“Dangote Refinery imports most of its crude, hence it is exposed to the effects of the ongoing crisis in the Middle East,” he said. “If the refinery gets direct crude supply from the NNPC, it will strengthen the country’s long-term energy diversification strategy and reduce exposure to international supply shocks.”

The NAJA chairman further noted that Nigeria’s continued dependence on imported refined petroleum products remains a major vulnerability, despite its status as Africa’s largest crude oil producer. He described the situation as economically unsustainable, particularly at a time when global uncertainties are driving up energy costs.

“If Nigeria’s major refineries, including Dangote, receive crude locally and transact in naira, the country will reduce its vulnerability to global market disruptions. It will also help stabilise the downstream petroleum sector,” he added.

Industry analysts have echoed similar sentiments, arguing that direct crude allocation to local refineries could yield multiple economic benefits. Beyond stabilising petrol prices, such a policy could ease pressure on the naira by reducing the demand for foreign exchange needed to import refined products and crude feedstock.

Observers also note that a robust domestic refining framework would enhance energy security, ensuring that Nigeria is better positioned to withstand external shocks such as geopolitical conflicts and supply chain disruptions. In this regard, the Dangote Refinery is widely seen as a critical asset capable of transforming the country’s petroleum landscape—provided it operates under favourable supply conditions.

While acknowledging the potential of the CNG programme to reduce dependence on petrol over time, NAJA insisted that the backbone of Nigeria’s energy strategy must remain anchored in efficient domestic refining. The association warned that failure to address crude supply constraints could undermine ongoing efforts to reform the sector.

“CNG is a good transition policy for transportation, but the backbone of Nigeria’s fuel supply must still come from efficient domestic refining,” Opara said.

NAJA concluded that a coordinated approach—combining alternative fuel initiatives with strong institutional support for local refineries—would offer the most effective pathway to shielding Nigerian motorists from the volatility of the international oil market.

As global uncertainties persist, the association’s call underscores the urgency of policy alignment in Nigeria’s energy sector, where the stakes extend beyond fuel prices to broader economic resilience.