FG Moves to End Dangote's Dollar Fuel Sales as Talks Raise Hopes for Naira Pricing Return
- Federal Government negotiates with Dangote Refinery to reverse dollar pricing for petroleum products
- Refinery's switch to dollar sales stems from changes in crude procurement, risking foreign exchange losses
- Ongoing talks aim to stabilise fuel prices and restore confidence in Nigeria's downstream petroleum market
Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
The Federal Government has opened high-level talks with the Dangote Petroleum Refinery in a bid to reverse the refinery's recent decision to sell petroleum products in United States dollars, a move that has contributed to rising fuel prices across Nigeria.
Sources familiar with the discussions disclosed that officials are working on a framework that could allow the refinery to resume domestic fuel sales in naira by increasing crude oil supplies under a naira-for-crude arrangement.
Source: Facebook
Government agencies lead negotiations
According to senior industry sources, the Nigerian National Petroleum Company Limited (NNPCL), the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) are jointly engaging Dangote Refinery to find a lasting solution.
The discussions are focused on addressing the challenges that prompted the refinery to adopt dollar-denominated pricing earlier this week, according to a report by PetroleumPriceNG.
One source, who requested anonymity because of the sensitivity of the negotiations, said both the government and the refinery recognise that restoring the naira-for-crude model remains the most sustainable path for Nigeria's downstream petroleum sector.
"The government understands the implications of the refinery's dollar pricing policy. Discussions are progressing towards increasing crude oil supplied in naira, while the refinery is willing to return product sales to naira once that framework is firmly established," the source said.
Why Dangote switched to dollar sales
The refinery recently announced that Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), and Aviation Turbine Kerosene (ATK) would now be sold in US dollars.
Industry insiders said the decision was driven by changes in the refinery's crude procurement structure, with a larger share of crude now being purchased in dollars.
Meanwhile, many refined products were still being sold locally in naira, exposing the company to significant foreign exchange losses.
To reduce this currency mismatch and manage growing exchange rate risks, the refinery aligned its product sales with its dollar-denominated crude purchases.
Petrol prices climb across depots
Although Dangote Refinery has maintained its official PMS gantry price at $0.779 per litre, the impact of dollar pricing has already filtered through the market.
Market intelligence indicates that the effective domestic benchmark has climbed to around ₦1,200 per litre, roughly ₦125 higher than the refinery's previous naira-equivalent benchmark.
Across Lagos, Port Harcourt, Warri and Calabar, marketers have adjusted ex-depot prices to between ₦1,190 and ₦1,230 per litre, reflecting the growing influence of the new pricing model.
Hope for market stability
Industry stakeholders believe a successful outcome from the ongoing negotiations could help stabilise fuel prices, ease foreign exchange pressures on marketers, and restore confidence in the downstream petroleum market.
Source: Getty Images
However, sources cautioned that no final agreement has been reached.
Talks are expected to continue as both the Federal Government and Dangote Refinery work toward a commercially viable arrangement that guarantees sustainable crude supply while protecting the refinery's operational efficiency.
Dangote Refinery releases fresh fuel prices in dollars
Legit.ng earlier reported that Dangote Petroleum Refinery has released a fresh price list for its petroleum products after officially ending naira-denominated sales for marketers, introducing a new United States dollar pricing regime for major fuel products.
The new policy, which took effect on Monday, July 13, 2026, requires marketers purchasing products through gantry and coastal loading to make all payments in US dollars, marking one of the refinery's biggest commercial changes since it began supplying refined petroleum products to the Nigerian market.
The move is expected to significantly influence Nigeria's downstream petroleum sector, where Dangote Refinery has become a dominant supplier of petrol, diesel, and aviation fuel.
Source: Legit.ng
