India Buys More Nigerian Crude as Dangote Turns to Cheaper US Oil
- India has emerged as one of the top buyers of Nigeria’s crude oil, ditching Russia amid growing sanctions from the US and its allies
- Reports say that Idina Oil Corporation recently bought one million barrels of Nigerian oil as companies seek alternative markets
- Conversely, the Dangote Refinery has increased its purchase and import of US crude amid a shortfall in local deliveries
Don't miss out! Join Legit.ng's Sports News channel on WhatsApp now!
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
Indian refiners are ramping up imports of Nigerian oil as they diversify away from Russian barrels under US diplomatic pressure.
Industry sources say Indian Oil Corporation recently secured one million barrels of Nigeria’s Agbami crude for September delivery, with Bharat Petroleum also locking in cargoes for September and October.
Source: Getty Images
Dangote Refinery’s US shift
Reuters reported that over two million barrels of Nigerian crude will arrive in India in the coming months, alongside supplies from Angola, the US, and Abu Dhabi.
Until recently, Indian state refiners focused on discounted Russian crude, but purchases have slowed since late July amid geopolitical pressure from Washington.
While Nigerian crude finds new buyers abroad, the Dangote Petroleum Refinery in Lagos is increasingly turning to US imports.
Data from Kpler shows that in July, US barrels made up 60% (370,000 bpd) of the refinery’s record intake of 590,000 bpd, overtaking Nigerian grades for the first time.
Operational realities at Africa’s largest refinery
Domestic supply challenges, competitive US pricing, and operational flexibility are driving this sourcing strategy.
Dangote officials have previously cited difficulties in securing adequate local crude under Nigeria’s Domestic Crude Supply Obligations.
Currently running at 85% of its 650,000 bpd capacity, Dangote plans to ramp up to 700,000 bpd, potentially boosting gasoline output to 322,000 bpd.
Most production is sold domestically, though exports of gasoline, jet fuel, and other products have reached markets in Oman, the Ivory Coast, and Europe.
Operational hurdles remain. The refinery has been importing naphtha about 6,000 bpd to feed its gasoline hydrotreater due to issues at its 204,000 bpd RFCC unit.
Source: Getty Images
Analysts say full, sustained capacity may not be achievable until late 2026 due to maintenance needs and mechanical challenges.
Nigeria’s oil output holds steady
On the upstream side, Nigerian crude and condensate production averaged 1.75 million bpd in July, the highest three-month average in five years. Reduced pipeline disruptions and rising onshore output have supported stability.
Local producers such as Seplat are expanding output by restarting wells and launching drilling campaigns, while infrastructure projects like the Otakikpo terminal mark milestones in private sector involvement.
The irony of Nigeria’s oil trade
The simultaneous rise in Indian purchases of Nigerian crude and Dangote’s reliance on US barrels highlights the complexity of the global oil market.
Price dynamics, supply logistics, and refinery optimisation—not national loyalty—are dictating trade flows.
As one analyst noted, “It’s not about where the oil is from—it’s about what makes commercial sense.”
India is emerging as one of Nigeria’s biggest crude buyers—but in a twist, Africa’s largest refinery at home is relying heavily on US imports.
The $20bn Dangote Petroleum Refinery is sourcing most of its feedstock from American barrels despite Nigeria’s vast reserves.
Industry watchers are calling it the “oil trade irony” of the year.
Nigeria set to unlock 220 oil blocks for sale
Legit.ng earlier reported that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has announced plans to license 220 open oil blocks located across Nigeria’s various onshore and offshore basins.
These long-dormant blocks are not abandoned but are awaiting concession through periodic licensing bid rounds, in line with Section 7(t) of the Petroleum Industry Act (PIA) 2021.
According to the commission, the blocks will be handed over to successful investors once the formal bidding process begins and the stipulated conditions are fulfilled.
PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find the “Recommended for you” block on the home page and enjoy!
Source: Legit.ng
