Nigeria’s petrol prices have hit a critical point, with prices soaring to over ₦1000 per liter. This unsustainable situation highlights our low crude oil productivity and sales.
The Dangote Oil Refinery produces over 60% of Nigeria’s petroleum products but faces significant challenges sourcing crude oil locally.
The Crude Oil Conundrum
Nigeria’s crude oil production rose to 1.459 million barrels per day in January 2026, below the OPEC quota of 1.5 million bpd. The government aims to reach 2.5 million barrels daily by 2026. However, oil theft, sabotage, and underinvestment hinder growth.
Dangote Refinery’s Struggle
The Dangote Refinery receives only 5 crude cargoes monthly from NNPC, far below the 13 cargoes needed.
This forces Dangote to source crude oil internationally, paying in dollars and increasing costs.
The refinery’s capacity is expected to increase to 1.4 million barrels per day, improving economies of scale.
Solutions:
– Increase Local Crude Supply: NNPC and local producers should prioritize Dangote Refinery, adhering to the Petroleum Industry Act (PIA).
– Crude-for-Naira Initiative: Expand the initiative to ensure Dangote Refinery gets sufficient crude oil.
– Diversify Crude Sources: Explore alternative sources, like partnering with African countries.
– Refinery Expansion: Dangote plans to increase capacity to 1.4 million barrels per day, improving economies of scale.
Impact:
– Reduced fuel imports, saving foreign exchange
– Increased energy security and stability
– Potential for lower petrol prices
Diversifying Nigeria’s Economy
Nigeria’s reliance on oil revenue is unsustainable. Investing in agriculture, manufacturing, and tech can diversify the economy, create jobs, and drive growth.
Productive Entrepreneurship.
Entrepreneurship is key to Nigeria’s growth. Supporting local businesses, investing in innovation, and promoting SMEs can create jobs and stimulate economic growth.
Nigeria’s low crude oil production is indeed hindering the country’s ability to capitalize on the current high global crude oil prices, exacerbated by the ongoing conflict in the Middle East, particularly between Iran and Israel/USA .
Conclusion
Nigeria’s petrol prices are a wake-up call. Addressing crude oil supply challenges and diversifying the economy can create a more sustainable future.
Let’s prioritize productive entrepreneurship and invest in Nigeria’s future.
Focus should not be only on FAAC monthly sharing among government institutions.
About the Author
Olubunmi Oluwadare is a renowned expert in entrepreneurship development, a National Business Development Service Provider (NBDSP), and business growth strategies. As the founder of www.uni-preneur.com and www.getajob.ng, he has empowered thousands of entrepreneurs and job seekers across Nigeria and Africa. As Chairman of BEEXO GROUP www.beexogroup.com, he continues to drive business growth and innovation in the region. His book, “I SEE MONEY IN AFRICA”, highlights the vast opportunities for entrepreneurs in Africa.
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