President Bola Tinubu has reiterated his commitment to implementing a market-driven model for oil sector reform in Nigeria, emphasizing the need to avoid the pitfalls of the past four decades. Speaking at the State House on Tuesday, he urged stakeholders to focus on enhancing local production to ensure a steady supply of petrol and petroleum products, thereby reducing the country’s reliance on imports.
The President highlighted that such efforts would free up foreign exchange for investments in the real sector. He recommended that stakeholders engage with Afreximbank as a settlement bank to tackle Naira pricing challenges for crude and refined products, noting the bank’s role as a financial adviser.
“Whatever solution we proffer in crude oil and refined products sales in Naira should not take us back to our experience in the last 40 years,” Tinubu stated. He emphasized the importance of allowing the market to dictate profits and losses, thereby enabling both independent marketers and the government to work collaboratively.
Finance Minister Wale Edun supported the President’s vision, assuring that the government’s decision to sell crude in Naira would remain intact, and it would not interfere with setting exchange rates for the oil sector.
Alhaji Aliko Dangote, President and CEO of Dangote Group, informed the President that the Dangote Refinery currently holds over 500 million liters of fuel in reserve, having already supplied 400 million liters to the economy. He expressed confidence in collaborating with other refineries managed by NNPCL to meet the local demand for petrol, estimated at 32 million liters.
Zach Adedeji, Chairman of the Federal Inland Revenue Service, echoed the vision of transforming Nigeria into a hub for refined products, stating that imports should cease once domestic production capacity is sufficient.
Since taking office, President Tinubu has implemented several reforms in the oil and gas sector, the most notable being the removal of fuel subsidies, which has resulted in increased petrol prices. Additionally, the introduction of a Naira-for-crude agreement aims to ease pressure on the nation’s foreign exchange reserves, positioning local refineries, including the Dangote Refinery, to support the initiative by supplying petrol in local currency.
These reforms signify a move toward full deregulation of the sector, with the goal of attracting investment and creating a level playing field for all stakeholders involved.
