Nigerian petrol prices have continued to rise as the country’s downstream oil and gas sector awaits a decision from the federal government on whether to continue the naira-for-crude deal between the Nigerian National Petroleum Co. Ltd (NNPCL) and the 650,000 barrel per day (bpd) Dangote Petroleum Refinery.

Initially agreed on October 1, 2024 for a period of six months, the naira-for-crude deal was introduced to save millions of dollars typically spent on fuel imports and to reduce the price of petrol at pumps.

So far, discussions on whether to extend the policy have yet to be resolved – with pump prices now at NGN930 ($0.60) from NGN860 ($0.56), according to Punch.

Dealers have blamed the government for drawing out the talks, while some marketers have projected prices to rise to NGN1,000 ($0.65) in a few weeks if the deal isn’t reinstated.

Alongside this, Dangote is also set to shut down its petrol-producing unit for scheduled maintenance for a period of 30 days in June, threatening to put more strain on an already struggling sector.

Regarding the stalled talks, a senior government official revealed that “Nothing new has happened. Probably after the holidays, the committee will sit and meet”.

According to Punch, an insider at the finance ministry also claimed that both parties had been unable to schedule any meetings in the last week.

In response to allegations, the NNPCL recently said that Dangote had received 48mn barrels of crude oil in naira under the agreement, with a total of 84mn barrels having been supplied to the plant since it started operations in 2023.

In a statement, the NNPCL’s chief corporate communications officer Olufemi Soneye confirmed that the initial deal had been agreed for a period of six months, and that discussions were ongoing with the aim of “establishing a new contract”.