In a move aimed at ensuring steady fuel supply and stabilising the downstream petroleum market, the Central Bank of Nigeria (CBN) has disbursed $1.25 billion to oil marketers and related operators for the importation of petroleum products between January and March 2025.
The apex bank’s intervention comes despite increased local refining capacity, particularly from the Dangote Petroleum Refinery, as fuel importers continue to dominate Nigeria’s petrol supply chain.
According to data obtained from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), fuel marketers imported about 69 per cent of the total 21 billion litres of petrol consumed nationwide between August 2024 and early October 2025.
The development underscores the delicate balance between Nigeria’s new refining ambitions and the entrenched import-dependent market structure.
Fuel import dominance persists despite Dangote refinery output
Although the Dangote Refinery has ramped up production since early 2025, data show that marketers still rely heavily on imported fuel to meet national demand.
Between January and March 2025, about 2.28 billion litres of petrol were brought into the country — one of the lowest quarterly import figures in recent years but still a significant share of total consumption.
According to the CBN’s quarterly statistical bulletin, $1.259 billion was released to cover fuel importation during the period.
The apex bank disbursed $457.83 million in January (36.2%), $283.54 million in February (22.5%), and $517.55 million in March (41.3%), reflecting a fluctuating but sustained allocation pattern.
The NMDPRA further detailed that 724.5 million litres of fuel were imported in January, 760 million litres in February, and 803.7 million litres in March.
The gradual decline in import volume coincides with increased domestic refining and blending capacity.
However, analysts note that Nigeria’s heavy fuel import dependence continues to exert pressure on foreign reserves and the naira-to-dollar exchange rate, as the petroleum sector remains a major consumer of foreign exchange.
Price competition drives import decisions
The growing competition between Dangote Refinery and fuel-importing marketers has intensified market dynamics.
Despite Dangote’s capacity to meet domestic demand and export to foreign markets, price differentials remain a key deciding factor for marketers.
Chinedu Ukadike, National Publicity Officer of the Independent Petroleum Marketers Association of Nigeria (IPMAN), said market survival depends on pricing rather than sentiment.
“In this business, pricing is everything,” Ukadike explained.
“Marketers will always go for the most affordable option because our margins are very thin. If imported products are cheaper, we have no choice but to patronise importers. But if Dangote’s refinery offers a better price, we will buy locally.”
He further noted that pricing fluctuations are influenced by global oil trends, exchange rate variations, and government policies, adding that no marketer can afford to ignore basic economics when making procurement decisions.
CBN pumps $1.25bn into fuel import to stabilise supply
The CBN’s $1.25bn intervention represents a strategic attempt to maintain supply stability in the face of volatile international energy markets and local pricing challenges.
With global oil prices and exchange rates fluctuating, the apex bank’s forex allocation helps cushion importers from excessive cost pressures.
According to the Major Energies Marketers Association of Nigeria (MEMAN), the latest Energy Bulletin indicates a reduction in the import parity price of Premium Motor Spirit (PMS) to ₦805.46 per litre at spot rates, signaling easing global cost pressures.
Market watchers believe that such interventions, while necessary in the short term, highlight the urgent need for Nigeria to deepen its domestic refining capacity and reduce dependency on imported petroleum products.
Balancing local refining and forex management
Economists argue that sustaining local production through facilities such as Dangote Refinery, Modular Refineries, and the Port Harcourt Refinery rehabilitation could gradually reduce the CBN’s forex burden and strengthen the naira.
However, full market transition may take time. “We are in a hybrid phase,” said an oil industry analyst.
“Imports still fill the gap as domestic production scales up. The CBN’s forex support ensures supply continuity, preventing fuel scarcity and inflationary shocks.”
While Dangote Refinery has been exporting petrol to countries including the United States and neighbouring African nations, local marketers remain cautious, citing cost margins and regulatory uncertainties.
The refinery, with a 650,000 barrels per day capacity, has consistently maintained that it can meet domestic fuel needs and export excess products.
But its pricing strategy and logistics model are still undergoing market adjustments.
Looking ahead: Transitioning from imports to self-sufficiency
Nigeria’s journey toward fuel self-sufficiency hinges on coordinated reforms across the energy, financial, and trade sectors.
As the CBN pumps $1.25bn into fuel import, stakeholders say a structured exit strategy is needed to gradually reduce such forex expenditures while incentivising local refining investments.
Industry observers expect the Federal Government to balance market liberalisation with strategic policy support to encourage private refiners and stabilise domestic pricing.
For now, the central bank’s role remains pivotal in ensuring liquidity and stability, even as the nation strives for a future where Nigeria’s fuel needs are met entirely by local refineries.
