In a move set to send new jitters through the Nigerian downstream oil sector, the Dangote Refinery has announced it will suspend the sale of Premium Motor Spirit (PMS), or petrol, in Naira starting tomorrow, September 28, 2025.
The refinery communicated this critical decision to its customers in a memo, stating that it has fully exhausted its crude oil allocations priced in the local currency. The implication is clear: without Naira-priced raw material, the refinery cannot sell the refined product in the same currency.
The Group Commercial Operations confirmed the unavoidable pivot:
“We cannot sustain PMS sales in Naira going forward.”
Why is This Happening and What Does It Mean?
This suspension is directly linked to the complex arrangement for crude supply within Nigeria. For the Dangote Refinery to receive crude at a Naira equivalent price, it relies on specific allocations from the Nigerian National Petroleum Company Limited (NNPCL). The refinery’s announcement confirms that its current quota of this Naira-priced crude has run out.
The major takeaway for the market is uncertainty:
- Forex Pressure: Moving forward, the refinery will likely demand payment in US Dollars for its petrol sales. This immediately increases the forex demand for marketers and could drive up the final pump price for consumers, potentially negating the benefits of locally refined fuel.
- Market Stability Risk: The suspension disrupts the existing supply chain that was counting on Naira-denominated product from the Dangote facility to stabilize prices.
- Refunds and Waiting Game: The refinery has requested that all customers currently engaged in Naira transactions formally apply for refunds. They assured customers that more information on when Naira sales will resume will be provided once the underlying crude allocation issue is resolved.
The immediate halt on local currency sales signals an urgent operational hurdle that requires swift resolution between the Dangote Refinery and key Nigerian government stakeholders. Until the Naira-denominated crude supply issue is fixed, Nigerians hoping for cheaper, local fuel might face further inflationary pressures.
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