In a significant shift in Nigeria’s petroleum market, the Federal Government has authorized petroleum marketers to purchase petrol directly from the Dangote refinery, bypassing the Nigerian National Petroleum Company Limited (NNPC). This development signals the end of NNPC’s monopoly as the sole off-taker of fuel from Dangote, fostering a more competitive market.
On Friday, Wale Edun, the Minister of Finance and Chairman of the Naira-crude sale implementation committee, announced this change during an update on the crude purchase and product sales initiative. He stated, “The committee is pleased to report a successful transition of operations in line with the directive issued by the Federal Executive Council.”
The implementation committee recently convened for its second post-commencement review meeting on October 10, assessing the progress of the Crude Oil and Refined Products Sales in naira initiative. Edun emphasized that the new framework has established a robust system for the local production and distribution of petroleum products intended for domestic consumption.
“With this mechanism now in full operation, along with the commencement of local production, we are well-positioned to transition to a fully deregulated market for all petroleum products,” Edun added, highlighting the broader implications of this change for the Nigerian economy.
The minister encouraged petroleum marketers to engage in direct purchases from refineries, stating, “Marketers are encouraged to initiate direct purchases from refineries on mutually negotiated commercial terms, which will promote competition and improve market efficiency.” This shift is expected to foster a more dynamic market environment.
Edun expressed confidence that these reforms would ultimately benefit Nigerians, asserting that the government remains committed to enhancing market conditions. “In the long term, these measures will create better market conditions for the benefit of all Nigerians,” he noted.
Overall, this development marks a pivotal moment in Nigeria’s oil industry, potentially leading to lower prices and improved access to fuel as the government works to fully deregulate the market.
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