Nigeria to Model US, Plans National Petroleum Product Stockpile Reserve to Counter Falling Prices

• The federal government is planning to build the National Strategic Stockpile to stockpile crude oil to hedge against falling prices
• The chief executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, disclosed this recently
• He said the move will insulate Nigeria from global supply shocks and ensure adequate energy security

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The Nigerian government is planning to build a national strategic petroleum products stockpile, modelled after the US crude reserve, to hedge the economy against global market disruptions.

Farouk Ahmed, the chief executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), disclosed this on Tuesday, April 15, 2025, saying the move would mitigate supply shocks and boost Nigeria’s energy security.

Nigeria aims to increase refining capacity

Nigeria frequently battles fuel scarcity and long queues despite being a top global crude oil producer.

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The country wants to increase its domestic refinery capacity, especially the mega Dangote Refinery, to build buffers against global supply disruptions.

Reuters reports that while the country keeps petroleum product reserves for 30 days, the National Strategic Stockpile will ensure it is never affected by global supply disruptions.

Ahmed, however, did not provide further details on the reserves' holding capacity and volume.

Dangote and other refineries crash petrol imports

According to reports, the Dangote Refinery and other smaller facilities have significantly cut Nigeria’s petrol imports from 50.8 million litres daily in September to N28.7 million litres in March 2025.

Data from NMDPRA shows that functional refineries are projected to refine about 770.500 barrels per day until June.

The authority expressed hopes that refining growth could eliminate petroleum product imports.

Petrol import drops

Legit.ng earlier reported that petroleum products, especially PMS, dropped as importers imported 156,897,000 litres of Premium Motor Spirit (PMS) within eight days. Separate documents from the Major Energies Marketers Association of Nigeria and the Nigerian Port Authority (NPA) confirm the numbers. 

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N350 per litre: Refinery owners predict new petrol prices as landing cost crashes

Separate documents from the Major Energies Marketers Association of Nigeria and the Nigerian Port Authority (NPA) confirm the numbers. 

After almost two weeks of selling petroleum products in dollars, the Dangote Refinery started selling in naira again. 

Landing costs crash

This change immediately brought down the loading cost to N865 from almost N1,000 per litre, bringing relief to Nigerians. 

As of last week, the price from the Dangote refinery was lower than that of imported fuel, but that has changed. 

At N853 per litre, the landing cost of imported fuel is now N12 cheaper than the loading cost offered by Dangote Refinery. 

This is the second price drop this week, down from N856.75 on Monday to N853 on-the-spot sales price on Tuesday.

Refinery owners predict new petrol prices

Legit.ng earlier reported that the Dangote Refinery has continued to crash petrol prices as parties returned to the negotiation table to renew the naira-for-crude deal.

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Nigerians expect cheaper fuel as landing cost drops again, lower than that of Dangote Refinery

Recall that the Nigerian government had ordered the deal’s continuation, stating it was not time-bound.

The development led to the mega refinery reverting to selling PMS in naira and crashing its petrol prices to N865 per litre from N930, with refinery owners predicting lower prices.

Source: Legit.ng