The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) has raised alarm over the diversion of 500,000 barrels per day (bpd) of crude oil meant for local refineries, blaming oil producers for prioritizing foreign exchange gains over domestic supply commitments. PETROAN Publicity Secretary, Joseph Obele, revealed on Wednesday that many refineries in Nigeria are struggling due to inadequate crude allocations, forcing them to operate below capacity or remain inactive.
Regulatory Response and Industry Debate
In response to these concerns, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) recently banned the export of crude oil allocated for local refining, a move PETROAN welcomed, saying it could help strengthen Nigeria’s refining sector and reduce dependence on imported petroleum products.
Obele stated:
“Approximately 500,000 barrels of crude oil per day are allocated for domestic refining, but these volumes often find their way to the international market. Immediate action is needed to stop this trend.”
The allegations have sparked debate among industry players. While oil producers argue that local refineries often fail to meet commercial terms, refiners insist that producers are deliberately neglecting their obligations to maximize profits from the international market.
Call for Swift Enforcement
PETROAN’s National President, Billy Gillis-Harry, called for strict enforcement of the crude export ban, stressing that ensuring local refineries receive adequate feedstock is crucial for boosting Nigeria’s self-sufficiency in refining, reducing fuel prices, and improving product availability.
The controversy underscores the challenges facing Nigeria’s refining sector, as stakeholders push for greater transparency and regulatory compliance to secure the country’s energy future.
