Fueling the Bill: Nigeria’s Petrol Imports Swallow N3.3 Trillion in Just 3 Months

Nigeria’s petrol imports have continued to exceed expectations, remaining persistent even as the country’s domestic refining capacity has increased. As the largest crude oil producer in Africa and home to the significant Dangote Refinery, Nigeria allocated an astonishing N3.3 trillion for petrol imports during the final three months of 2024.

This ongoing dependence on imported fuel is severely impacting Nigeria’s economy, with energy analysts cautioning that the exorbitant costs associated with imported fuel are depleting the nation’s resources and worsening existing economic challenges.

The anticipated commencement of operations at the Dangote Refinery, along with the revitalization of state-owned refineries, was expected to diminish Nigeria’s reliance on imported petrol. Nevertheless, fuel imports have persisted unabated, raising alarms regarding the country’s ongoing dependence on foreign fuel supplies.

Indeed, Nigeria’s fuel import expenditure surged to N6 trillion within a mere five months, as major oil marketers continued to import refined petroleum products despite the advancements in domestic refining capabilities. The Nigerian National Petroleum Corporation (NNPC) has also reported the initiation of petrol production at the Port Harcourt refinery following an extensive rehabilitation period.

Experts opinions

Industry stakeholders are now advocating for an end to fuel imports. Billy Gillis-Harry, the National President of the Petroleum Products Retail Outlet Owners Association of Nigeria, emphasized the importance of fostering local content and bolstering the domestic economy. Conversely, Clement Isong, the Executive Secretary of the Major Energies Marketers Association of Nigeria, contends that importation fosters competition and contributes to lowering fuel prices.

Energy specialists caution that Nigeria’s economy is facing significant pressure due to the high costs associated with imported fuel. This situation is not only depleting the nation’s resources but also exacerbating its economic challenges. Although there were initial expectations that the recently launched Dangote Refinery and upgraded state-owned refineries would reduce the country’s dependence on foreign petrol, the importation of fuel has persisted, raising alarms about Nigeria’s ongoing reliance on external energy supplies.

Import vs Export

Despite initiatives aimed at enhancing local refinery output, Nigeria continues to face a considerable challenge due to its reliance on imported petrol. In 2024, the nation’s petrol imports soared to 13.76 billion litres, overshadowing the 794,369,526 litres produced by domestic refineries from January to May of the same year.

The contrast between import figures and local production is stark. In January, local refineries managed to produce only 90,498,122 litres, while May recorded the highest output at 286,074,494 litres. Conversely, petrol imports constituted the majority of the total petrol supply for the year, which amounted to 14,553,681,578 litres.

The supply trends reflected the import patterns, with significant peaks observed in October and December. Daily average petrol supply varied considerably, ranging from 42.3 million litres in May to a peak of 56 million litres in October. The overall daily average supply for the year was recorded at 43,775,636 litres.

This data highlights the urgent need for stable supply mechanisms to satisfy Nigeria’s fuel consumption requirements. To mitigate reliance on foreign petrol, it is crucial to enhance local refinery production and streamline supply chain processes.