NNPC Boosts Crude Supply to Dangote Refinery as Allocation Rises to Seven Cargoes in May Amid Supply Pressures and Global Market Shifts

Nigeria’s state-owned oil giant, Nigerian National Petroleum Company Limited (NNPC), has concluded plans to increase crude oil allocations to the Dangote Refinery, raising the number of cargoes scheduled for delivery in May to seven, up from the five cargoes supplied in previous months.

The development signals a strategic adjustment in domestic crude supply distribution as authorities intensify efforts to strengthen local refining capacity and reduce reliance on imported petroleum products.

A senior source within the national oil company confirmed the update on Wednesday, noting a deliberate push to scale up supply to the Lagos-based mega refinery.

This increase follows earlier concerns raised by the refinery’s management over insufficient crude allocations under the crude-for-naira initiative. On March 25, David Bird, chief executive officer (CEO) of the Dangote refinery, said the plant was expected to receive about 13 to 15 crude cargoes every month under the crude-for-naira programme but currently gets only five.

However, fresh indications suggest a gradual improvement in supply volumes, with allocations now set to rise to seven cargoes beginning in May.

“We are focused on increasing allocation crude oil supply to Dangote,” a source said.

Industry observers view the move as a critical step toward optimizing the refinery’s operational capacity, which remains one of the largest in Africa and a key component of Nigeria’s energy security strategy.

Meanwhile, global market dynamics are also influencing Nigeria’s crude distribution decisions. In a report published on Tuesday, Reuters indicated that increased allocations to the refinery may tighten the volume of Nigerian crude available for export. This situation is further complicated by disruptions in global supply chains, particularly linked to the ongoing Iran war, which has significantly reduced output from parts of the Middle East.

As a result, international buyers are increasingly turning to alternative sources, including Nigeria, to meet their crude oil demands.

“NNPC has allocated more cargoes to Dangote for May. While this will not completely meet our demands, it can help. We are also in negotiation with NNPC for more volumes,“ a senior Dangote official told Reuters.

Analysts note that crude supplied by NNPC offers cost advantages to the refinery, largely due to reduced logistics and shipping expenses compared to imports from distant markets.

The incremental increase in supply also comes on the heels of a recent price adjustment by the refinery. On March 26, the Dangote refinery reduced its ex-gantry petrol price to N1,200 per litre, a move widely seen as a response to improving supply conditions and an attempt to stabilize the domestic fuel market.

With negotiations for additional volumes still ongoing, stakeholders anticipate further adjustments in allocation levels as both parties work to align supply with the refinery’s full processing capacity, potentially reshaping Nigeria’s downstream petroleum landscape in the months ahead.