Why a Naira-for-crude policy benefits the economy.

Nigeria’s oil sector has always been a major topic of national discussion, as the economy heavily depends on oil revenues to fund key sectors like infrastructure, healthcare, and education. For years, the fuel subsidy kept fuel prices artificially low, costing the government billions while largely benefiting the wealthy and encouraging the importation of products that could be locally produced.

To address this imbalance and reduce dependency on imported refined petroleum, the federal government introduced the **Naira-for-Crude** policy. Launched officially in October 2024, it mandates the sale of crude oil to local refineries in Naira, rather than in U.S. dollars. This approach aims to boost local refining, reduce pressure on foreign exchange reserves, and support broader economic reforms.

Under this policy, the Nigerian National Petroleum Company Limited (NNPCL) supplies 385,000 barrels per day to the Dangote Refinery, with payments made in Naira. It is overseen by an Implementation Committee, with contributions from key stakeholders such as the FIRS, CBN, and NPA, ensuring compliance and alignment with national goals.

The policy is grounded in four key principles: Naira-based transactions, crude allocation to local refineries, a fixed reference exchange rate by the CBN, and streamlined regulatory processes via a One-Stop Shop. These measures aim to simplify operations, attract investment, and create a more stable financial and energy system.

Ultimately, the Naira-for-Crude policy is seen as a strategic shift toward economic independence. It promotes self-sufficiency, reduces monopoly control, ensures fair fuel pricing, and enhances access to energy for ordinary Nigerians. More than a policy, it represents a practical move toward fixing long-standing inefficiencies and positioning Nigeria for sustainable growth.

FAITH MIMDOO KEGH

Manager – Oversees the daily operations, editorial planning, and strategic direction of the platform. A graduate with a solid academic foundation in media and communication, Faith brings a wealth of experience to the TokinPoint.

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