Despite being Africa’s largest crude oil producer, Nigeria imported crude oil worth a staggering N5.734 trillion in 2025, highlighting a deepening contradiction in its oil sector.
The imports occurred even as the Federal Government introduced the naira-for-crude policy aimed at boosting local refinery supply. Data from the National Bureau of Statistics shows that this marked a sharp reversal from 2024, when no crude imports were recorded.
In contrast, Nigeria produced about 530.41 million barrels of crude oil in 2025, generating roughly N55.5 trillion in revenue. The figures underscore a widening disconnect between strong upstream production and limited domestic refining supply.
Analysis of the NBS Foreign Trade in Goods Statistics report revealed that crude oil imports became one of the country’s major import items during the year. In the first quarter alone, imports stood at N1.19 trillion, rising to N1.64 trillion in the second quarter and peaking at N2.403 trillion in the third quarter.
Although imports dropped significantly by 79.2% to N499.75 billion in the fourth quarter, the trend pointed to a volatile and inconsistent supply environment throughout the year.
Monthly data further highlighted the instability. Imports rose from N335.69 billion in January to a yearly high of N1.28 trillion in July before declining sharply towards the end of the year, eventually falling to zero in December.
Industry findings indicate that local refineries—including modular plants and large-scale facilities like the Dangote Petroleum Refinery & Petrochemicals—increasingly relied on international markets to source crude due to persistent domestic shortages.
The Crude Oil Refinery-owners Association of Nigeria confirmed that many refiners have received little to no allocation under the Domestic Crude Oil Supply Obligation framework or the naira-for-crude policy.
According to CORAN spokesperson Eche Idoko, some modular refineries operate far below capacity due to lack of feedstock, while others shut down entirely. He cited cases where facilities with a 10,000-barrel capacity produce as little as 1,000 barrels or suspend operations for months.
Even the Dangote refinery has reportedly operated below capacity due to insufficient crude supply. The company disclosed it receives about five cargoes monthly from the Nigerian National Petroleum Company under the naira-for-crude arrangement—far short of the 13 cargoes needed to meet demand.
To bridge the gap, the refinery sources additional crude from international suppliers, often at global market prices and with foreign exchange obtained at open market rates.
Experts attribute the supply challenges partly to the reluctance of international oil companies to sell crude domestically. Many prefer exporting under dollar-denominated contracts, citing better pricing, fewer regulatory constraints, and concerns over policy uncertainties.
Disputes over pricing frameworks and the involvement of third-party traders have also complicated domestic supply arrangements, further weakening the effectiveness of government policies.
While the naira-for-crude initiative was designed to ease pressure on foreign exchange and guarantee steady feedstock supply, it has so far fallen short of expectations.
The ongoing situation raises concerns about Nigeria’s ability to align its oil production with domestic refining needs, even as it continues to depend on imports to sustain local operations.
