By Ifeoluwa Odunayo
The Federal Executive Council has approved the full implementation of the Naira-for-Crude policy — a move aimed at reshaping how Nigeria pays for refined petroleum products and sells crude oil domestically.
In simple terms, this means Nigerian refiners, such as Dangote Refinery, will now be required to purchase crude oil using naira instead of US dollars.
In turn, they will sell refined fuel within Nigeria in the local currency.
This policy marks a shift away from the heavy reliance on foreign exchange for petroleum transactions, a practice that has strained the country’s FX reserves and contributed to the naira’s volatility.
What You Should Know:
Fuel Prices May Stabilize:
By eliminating the need for dollars in crude purchases, local refiners could cut costs tied to forex fluctuations, potentially leading to more stable fuel prices over time.
Reduced Pressure on the Naira:
Since petroleum deals have traditionally been dollar-denominated, switching to naira could ease the demand for foreign currency and help strengthen the naira’s value.
This represents a significant policy shift from short-term measures, such as the recently concluded six-month agreement with Dangote Refinery, towards a long-term strategy designed to fortify Nigeria’s oil sector from within.
More updates are expected as implementation unfolds.
