Refineries Spend N5.7tn on Foreign Oil Despite Naira-for-Crude Policy

Nigerian refineries spent about N5.7 trillion importing crude oil in 2025 despite the Federal Government’s naira-for-crude policy aimed at boosting domestic supply.

Data from the National Bureau of Statistics revealed that crude oil imports surged significantly during the year, marking a sharp contrast to 2024 when no such imports were recorded.

The imports, classified under petroleum oils and crude obtained from bituminous minerals, emerged as one of Nigeria’s major import items due to supply shortages to local refineries.

In the first quarter of 2025 alone, crude oil imports were valued at approximately N1.19 trillion, highlighting the urgency with which refinery operators sought alternative sources of feedstock.

The development comes despite Nigeria producing about 530.41 million barrels of crude oil and generating roughly N55.5 trillion in revenue from crude sales within the same period.

The naira-for-crude policy was introduced to allow local refineries purchase crude oil in naira instead of dollars, with the aim of reducing foreign exchange pressure and ensuring steady supply to domestic refining facilities.

However, the continued importation of crude suggests a disconnect between local production and supply to refineries, raising concerns about the effectiveness of the policy.

Industry analysts attribute the situation to challenges including inadequate allocation of crude to local refineries and operational constraints within the sector.

The trend underscores ongoing structural issues in Nigeria’s oil and gas industry, where domestic refining capacity still relies partly on imported crude despite the country’s status as a major oil producer.

The situation has also raised questions about the implementation of policies designed to strengthen local refining and reduce dependence on foreign exchange.