Nigeria's petrol imports jump 59.5% despite Dangote Refinery supplying domestic market

Abuja: Nigeria experienced a sharp 59.5% increase in petrol imports during May, with daily imports rising to 5.9 million liters. This surge occurred even as the Dangote Petroleum Refinery committed its entire Premium Motor Spirit (PMS) output to the domestic market, supplying approximately 41.5 million liters daily.

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While the Dangote Refinery has significantly altered Nigeria’s downstream market by ensuring domestic production of fuel despite the shutdown of government-owned facilities, imports of products have not been completely displaced in the country.

Data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) indicates that imported petrol constituted about 12.4% of the total petrol supply in May. Despite the Dangote refinery's substantial contribution, imports have not been entirely eliminated, fueling a debate among industry stakeholders.

The Dangote Refinery operated at an average capacity utilization of 101.25% in May, underscoring its growing role in Nigeria's fuel market. While the refinery's output has significantly altered the downstream landscape, the continued reliance on imports raises questions about the pace of Nigeria's transition to a fully self-sufficient fuel market.

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While the regulator and a section of the industry argue that a continued level of fuel imports is necessary to guarantee energy security, ensure supply diversity and prevent a monopoly, the Dangote Refinery has repeatedly maintained that unrestricted imports undermine local refining investments and discourage the growth of domestic refining capacity.

Proponents of continued imports argue for their necessity in ensuring energy security and supply diversity, preventing monopolies. Conversely, the Dangote Refinery maintains that unrestricted imports undermine local refining investments and hinder the growth of domestic refining capacity. Halting imports, they argue, would protect billions invested in refining infrastructure and accelerate Nigeria's move away from dependence on foreign petroleum products, thereby boosting job creation and economic growth.

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Besides, it has emphasised that halting imports altogether will help protect billions of dollars invested in refining infrastructure and accelerate Nigeria’s transition away from dependence on imported petroleum products, thereby enhancing job creation and economic growth.