Petrol Imports Continue as Domestic Refineries Underperform
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Meanwhile, Nigeria continues to rely heavily on petrol imports despite a combined domestic refining capacity of 985,000 barrels per day. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) revealed that the country’s three operational refineries contribute less than 50 per cent of daily petrol consumption.
NMDPRA Chief Executive, Farouk Ahmed, disclosed at a press conference on Wednesday that Nigeria currently consumes 50 million litres of petrol daily. He noted that import licences were being issued to bridge the shortfall, highlighting the country’s ongoing dependency on foreign refined products.
This reliance persists despite the resumption of operations at the state-owned Port Harcourt and Warri refineries in 2024 and the launch of the 650,000 barrels per day Dangote refinery. According to Ahmed, none of the domestic refinery operators have imported petroleum products this year, leaving independent oil marketing companies to fill the supply gap.
Impact of Subsidy Removal on Consumption
NMDPRA noted a significant decline in national petrol consumption from an average of 66 million litres per day to 50 million litres following the removal of the petrol subsidy in May 2023. However, domestic refineries are still unable to meet the reduced demand, making imports essential to avoid shortages.
“Less than 50 per cent of daily consumption is contributed by domestic refineries. The shortfall is sourced through imports,” said Ogbugo Ukoha, Executive Director of Distribution System, Storage, and Retailing Infrastructure at NMDPRA.
Concerns Over Product Quality and Market Dynamics
Ukoha addressed concerns over the quality of imported petrol, asserting that all products meet the specifications of the Standard Organisation of Nigeria and the Petroleum Industry Act 2021. He dismissed social media rumours about substandard products, warning against misinformation.
Looking Ahead: Balancing Power and Petroleum Supply
As Nigeria sets new records in power generation and distribution, the government’s energy reforms are poised to enhance reliability and access. However, the country’s reliance on petrol imports underscores the challenges facing its refining sector.
The push to upgrade electricity consumers to Band A, coupled with ongoing power sector reforms, reflects a broader strategy to improve energy supply across the nation. Yet, the complexities of financing, infrastructure investment, and market stability continue to shape Nigeria’s energy landscape.
With its ambitious agenda, the Nigerian government faces a delicate balancing act—powering the nation’s growth while navigating the challenges of a rapidly evolving energy market.
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