The Chief Executive of Dangote Refinery, David Bird, has stated that the 650,000-barrel-per-day plant does not receive discounted crude despite the naira-for-crude deal.
He revealed this in a media chat on Monday released on the company’s X account.
Bird was speaking in defense of the refinery, which increased the price of petrol at the gantry by N396 per liter to N1,175 per liter from N799 before the Iran-United States-Israel war.
According to him, the refinery is exposed to international commodity markets, including crude oil prices, freight rates, insurance, and financing costs, which is the reason for the incessant hike in its petrol price as of the rising crude oil price.
He said that import-dependent countries like Nigeria are the worst hit amid the global oil crisis escalation.
“Key talking points from a media chat with the managing director/CEO of Dangote Petroleum Refinery, David Bird
“Dangote Refinery will continue to meet Nigeria’s fuel demand despite global supply disruptions and market volatility.
“Domestic refining gives Nigeria supply security, ensuring the country avoids fuel shortages and queues even when global markets are disrupted.
“Even under the crude-for-naira arrangement, Nigerian crude is purchased at international benchmark prices, meaning the refinery does not receive discounted crude.
“Import-dependent countries are worst hit as the global oil crisis escalates.
“Global oil markets are experiencing extreme volatility, with crude prices rising from the mid-$60 range to nearly $120 per barrel within a week.
“The refinery is fully exposed to international commodity markets, including crude oil prices, freight rates, insurance, and financing costs.
“Freight costs have surged dramatically, with tanker costs rising from about $800,000 to roughly $3.5 million per shipment in the current market environment.
“Dangote Refinery operates at its full nameplate capacity of about 650,000 barrels per day, with the potential to increase production to around 700,000 barrels per day,” Dangote Refinery wrote on X.
The Naira-for-crude kicked off in 2024, whereby Nigerian National Petroleum Company Limited supplies crude to Dangote Refinery in Naira.
Despite the Naira-for-crude policy, Dangote Refinery has increased its Gantry at least three times in a week to N1,175 as of Monday evening.
Meanwhile, Nigerians are lamenting the rising petrol prices, which have surged to above N1,000 per liter despite the Dangote Refinery and Naira-for-crude deal policy by the Nigerian government.
