₦airaland Forum

AskiaHarem:
It’s wild how there’s a Balkan esc war going on in the middle of Africa and The East African Community is essentially warring between it’s members. How is little o’l Rwanda causing such a ruckus right smack dab in the center of the neighborhood committee so causally and unchallenged? Not to mention the possibility of another South Sudan civil war breaking out.

I remember only a few years ago when this was speculated to happen in the ECOWAS neighborhood because of the junta alliance which has moderately calmed down the past year.

The EAC never should have expanded.

Thoughts?

People accuse ECOWAS of many things especially of being puppets to the likes of France but I would say despite the French influence, ECOWAS is the most active African regional bloc.

zendi:
20 Japanese refineries import all their crude oil in the petro-currency, dollars.
Japan has no crude oil.
But they sell refined products to the domestic market in the local currency. They must also be exporting, but I assume that all operations are done at profit to the refineries..

Nigeria's private refineries should pay for every drop of our crude oil in the petro currency, dollars.
To do otherwise would deplete our external reserves and subsidize the export trade of private entities.
It will also be subsidizing, unfortunately, both land and sea smuggling of cheap refined products out of the country.

Nigerian refineries will operate even more profitably than their Japanese counterparts because "importing" crude oil from home will eliminate freight (shipping) and Maritime insurance costs from the landing cost, than would be the case if importing crude from abroad.
The same advantage for Petroleum marketers, than if importing products from abroad.

Summary, private refineries should procure crude oil from wherever found, or pay for our own at the international price and currency, then sell products to domestic offtakers at whatever conversion rate that makes them profit, but not in foreign currency.

Competition should checkmate monopoly and excessive price hiking.

I'm just an ordinary citizen observing the Oligarch and the Cabal at each other's throats for control of the nation's petroleum fortunes.

Finally, someone seeing things the way I’ve been seeing them on this matter.
Except the Government intends to use the crude for naira deal to subsidize petrol slightly.

Raider76:
Alhaji has really gone global. The import cabals and NNPC will be unhappy to read stories like this:

https://www.reuters.com/business/energy/us-jet-fuel-imports-surge-nigerias-dangote-refinery-pushes-barrels-west-2025-03-24/

Nice. More dollars for Alhaji.

Trump again 😆

“The recent U.S. sanctions targeting Iran's oil industry have contributed to a notable increase in Brent crude oil prices. On March 20, 2025, the United States imposed sanctions on individuals and entities involved in purchasing and processing Iranian crude oil, including the Chinese refinery Shandong Shouguang Luqing Petrochemical Co., Ltd.
Reuters

In response, Brent crude futures rose by over $1, reflecting market concerns about potential disruptions in oil supply due to heightened geopolitical tensions.

This development underscores the sensitivity of global oil markets to geopolitical events, particularly those affecting major oil-producing nations like Iran. Traders and analysts will likely monitor the situation closely, as further escalations could lead to additional volatility in oil prices”

Zegra:
Trust me ,all these back and forth na because them no allow ALH to game the system.
typically when you import something with dollar ,you sell it to the local market in naira and still make your profit.
Chinedu import computer in dollars ,will you now say chinedu should sell his computers to local users in dollar ?
Baba is doing all these because he's becoming too big for the goverment to manage and that along na risk to the country.

This doesn’t correlate with Dangote though. Dangote is a producer and his raw material is in dollars. The marketers who buy in dollars are the ones who fits perfectly to your analogy. Those marketers cannot sell to retailers in dollars but naira.

ositadima1:
Ok, lets watch and see, I don't like arguing unnecessarily these days, when the issues starting coming up I will quote you again. It wont be long.

The FG may resume the crude for naira deal though. I’m not against it, I’m thinking broadly from all angles.

ositadima1:
That is not entirely correct. Avoid using the word "we." Dangote Refinery produces many byproducts. If I am correct, it is situated in a free zone, meaning Nigeria will not benefit significantly from taxation. Taxation itself is a sensitive topic, as one could argue that much of it is mismanaged or embezzled.

The primary benefit is the use of naira for both crude oil and refined products, reducing dependence on foreign exchange and driving prices down. But the situation has changed—you (Marketers) now need to source dollars as before. And where do these dollars come from? Your guess is as good as mine—Nigeria’s foreign reserves.

Most of the foreign exchange revenue generated by Dangote will likely go toward cost recovery in the next few years. I also heard that Dangote plans to list on the London Stock Exchange, which means more forex will flow out in the long run. It makes no sense that a resource available in abundance locally is still being sold in foreign currency.

That it’s situated in a free trade zone doesn’t stop the FX from coming to Nigeria, does it? If not, what would be the purpose of a free trade zone if not to export and get FX? Also, if it sells more than 25% of its products to Nigeria it would be taxed based on the new tax reforms.

I have told you that Dangote himself at a point would need adequate foreign exchange to run the business, wouldn’t he then be converting all those naira back to dollars and then put pressure on the FX as well? Why don’t you also look at that angle?

If marketers put pressure on FX and then give the FX to Dangote who would then use it to buy crude from Nigeria, wouldn’t that be almost equilibrium?

Dangote would list on both the Nigerian and London stock exchanges like Seplat and Airtel.

The real advantage of Dangote refinery is not because they would sell fuel and diesel in naira (except the Government decides to subsidize with Dangote by subsidizing crude in order for us to get cheaper fuel).

The real advantage of Dangote refinery is that we are now producers of so many by products used for various manufacturing which can be sold in naira and that we would also become major exporters of refined products in Africa.

KarlTom:
This is where the issues lie

1. The crude-for-naira deal is "NNPC supplies DR in ₦, and DR supplies the Nigerian market in ₦". This will eliminate any and every FX requirement for servicing Nigerian market.

2. DR gets a sizable stock from foreign markets so I don't think he is illiquid in FX.

3. I choose to read between the lines and I make bold to say that all this is the working of the 'cabal' and those hellbent on taking us back to pre-PIA era.

4. Finally, we should ask ourselves how the importers get their FX since they sell their stock to Nigerians in ₦.

I struggle to see the difference here. Official reports I’ve seen puts Dangote’s current supply at around 400k bpd as at January 2025 (although Edwin now claims it is at 500k bpd).

The Nigerian market on average consumes over 330k bpd which means presently at least, he his selling mostly to Nigeria and all in naira at probably 250k bpd worth of petroleum products and exporting just a little.

When he tries to import the extra 300k bpd to ramp up the refinery’s capacity he needs dollars and taking all of those naira sales to the Banks to get dollars also puts pressure on the naira. So I don’t see the major difference at least until Dangote gets to full capacity and can export the other half comfortably.

With this new method, marketers would first put naira under pressure by searching for dollars to buy from Dangote but the dollars is recycled because Dangote takes those dollars to then buy crude from Nigeria (mostly from NNPC at 300k bpd approximately and note that the refining margin is low so the difference with his total sales to marketers is not that much). NNPC then recycles the dollars back to CBN, so it remains at equilibrium. Dangote on the other hand can then export $1 Billion worth of polypropylene yearly while saving us $260 million of annual polypropylene imports simultaneously. I believe the polypropylene and other raw materials for manufacturing may likely be sold in naira still.

HesInMe:
Modern and properly operational ports are a critical asset for a $1 trillion dollar economy, but mehn....

https://saharareporters.com/2025/03/18/tinubus-lebanese-ally-chagoury-awarded-700million-lagos-ports-contract-despite-lacking

Please don't make this about tribe or religion. Only losers and suckers fight about such distractions.

This is wrong if true.

chimex38:
I guess they were smart enough to think of that.
But the FG via NNPC chickened out at only 7% stake like Chickens 🐔 🐔


Probably they felt their refineries will also be a game changer as well.

The initial deal which was made in 2020/2021 assumed that Nigerian NNPC would be able to supply Dangote about 300k bpd crude for the first 2 years of operations (during test runs and start- ups) to form the remaining 12.5% stake.
At that time, crude oil production still hovered around 1.8 million bpd comfortably and it seemed easy to get to 2 million bpd again which it was in 2019 before COVID. But in 2021/2022/2023 it had fallen gradually to an all time average low of 1.2 -1.3 million bpd. NNPC cancelled the former contract and eventually settled for 7.5% stake which they still had to borrow for.

ositadima1:
You're asking me a leading question. Not only did they handle it terribly—as if they had better solutions to the economic implications the refinery was supposed to bring to Nigeria—but they are still handling it badly. Currently, Dangote has ceased selling to Nigeria. Is this acceptable to you, or do you want to ask another amateurish question?

Did Dangote cease selling to Nigeria or he ceased selling to Nigeria in naira?

Well, I look at this from a different angle. The Government made the crude for naira deal for 6 months as a head start but the crude for naira deal while brilliant, also has its complications.

1) It doesn’t make Dangote liquid enough in dollars (which his business requires). The volume of naira transactions Dangote would then have to convert to dollars to import parts of the remaining crude he needs to run the refinery operations and service his debts also makes the whole exercise somewhat redundant.

2) Oil prices are now around $70 per barrel. At this point, the upstream sector wants all the FX they can get (and NNPC is not an exception) while the large refiners love it because they can purchase crude easily and get better margins (refining is a low margin business generally). In that sense, NNPC and IOC’s would easily supply Dangote if they get dollars. This is also good for us because not all the FX from Dangote’s exports comes to us because Dangote (at least for the moment) would have to send some out to service his debt to Afrexim Bank. While NNPC on the other hand, have a special account with the CBN, so dollars to NNPC flows to the CBN first before anything else is done with it.

3) There may be options of cheaper crude out there which importers can buy and which NNPC knows about due to their long years of connection and experience.

4) Dangote himself can import WTI crude from America which is cheap and his refinery can refine it which gives him the advantage.

Given all of these points, I can see why the Government paused the scheme for a while to study the loopholes if any and to see if it can be better.

RodgersAkpafu:
It's such a disgrace that Dangote is not being supported to the max like should have been the case

If this was a Chinese company
The CCP will give Dangote EVERYTHING he needs

How is he not being supported? Oil prices are low and this is the time NNPC needs all the dollars it can get. If NNPC can give Dangote 70% of the crude he requires in dollars and then be the sole buyer of all of Dangote’s PMS, Diesel and AGO to at least 70% of Nigeria’s capacity, would that be a bad deal? Dangote would export up to 60% of his products as well when at full capacity.

Mpeace:
I want to buy one drum of fuel to sell black market.
Dangote says he will stop selling to the Nigerian market once the deal ends as he cannot buy in dollars from abroad and sell to Nigerians in Naira.
Fuel price go soon go up

In that case, NNPC can be the sole buyer again in dollars and then they distribute to marketers in Naira.

KarlTom:
ARADEL. -2.43%
CONOIL. ±
ETERNA. ±
OandO. -4.55%

Expected for today at least.

mikeapollo:
It is for the stocks market and everything or anything that affects the stocks market.

I tire oo. As if oil in Rivers state does not affect the likes of Oando, Seplat, Aradel, etc.

Saw this somewhere (yet to verify) but if true then thank God. My Aradel can breathe 😆

mikeapollo:
Fubara said clearly that he will obey the Supreme Court ruling immediately after the ruling was given and he took concrete steps to do that including inviting the Speaker for a meeting and also going to present the budget to the RSHA. What was the reaction and response from Wike's camp? They gathered signatures to impeach the governor.
The attack on the pipeline is not a response or reaction to the Supreme Court ruling because Fubara had said that he will obey fully.
The pipeline attack was a response and reaction to the signatures gathered for the impeachment of Fubara and Wike said nothing will happen and went on to attack a whole Ijaw people! And he was being tolerated by the president. Now, the president has appointed Wike's ally and friend as sole administrator .
Wike said he would blow up Nigeria. That is his handiwork. Such a reckless talk by a minister and the president wa looking and did little or nothing to put him in check for the peace of Rivers and Nigeria

Nah, the militants threatened that they would blow up pipelines if the FAAC allocation was kept aside for the Governor until he presents a legal object. This happened before Wike’s interview. Also, Fubara knows what to do if he wants to resolve the problem. You have withdrawn the salaries of those legislators for some time now, you destroyed their building and you just want to go there to present the budget without some back door political resolutions.

The retired chief of naval personnel was a top navy chief during his service years so he would have definitely been close to all state Governors in the Niger Delta. So it’s not out of place to see him take pictures with Wike who was Governor in a key Niger Delta state for the navy.

mikeapollo:
The president himself is the reason all this is happening. zhe gas been clueless in handling the matter. zhie could you allow someone you appointed in your govt yo go about causing confusion and destabilizing a critical state like Rivers where huge oil revenye comes from?
The president is having a meeting with PANDEF and elders from Rivers State, and then his appointee minister holds a press conference to abuse, insult and even threaten his guests! Which sound president would tolerate that?
The biased Supreme Court ruled that there should be no revenue allocations to Rivers state government. Now let us see if they will allocate funds to this illegal Sole Administrator to run the state for the next 6 months or not.

Wike or no Wike, the moment militants threatened to destroy pipelines as a response to the Supreme Court order, the battle line was drawn.

The supreme court is the law and in a democracy, the president and the entire state acts on their orders. In the eyes of the law, there is nothing to hold Wike responsible for if the militants threatens the state with blowing of pipelines as a response to a decree based on the law. That is war against the state and once that happens, it matters little if the president just calls Wike to order because the court judgement was against Fubara the state Governor not Wike. Suspending Wike’s allies in the house as well is already enough of a statement made to Wike by the president in this case else they would have easily been the ones to take over to Wike’s delight.

You must also understand Fubara is not on record as CSO of the state clearly condemning the threat of the militants against the supreme court order, instead we have him on video telling the youths he would give them the order when the time comes. Also, 12 hours after the pipeline vandalization, the state Governor was yet to release a statement but seem to act non chalantly.

Let us judge fairly considering the broader context and not just because we hate the president.

Willie2015:
I don't think you have a better Intel than...
the President and the NSA on this event...
They are in the best position to do the needful...
Those boyz you mention will sell their entire 1st -10th generation to get a piece of the cake...
Sometimes , we need to have a good risk management when trading...
It saves one from unforeseen events and make you prepare for better opportunity...

The truth is that if the president just watched and allowed the House of Assemblies impeach Fubara, that would have been more problematic.

Also, as a president you don’t cower to those blowing pipelines and issuing threats. You get firm else we are just a banana republic and the state would be surrendering her power to those people whose first response to the Supreme Court order was to threaten to blow the pipelines.

If the sponsors of the militants sense fear as a response to their threat, that’s the end. It would mean they have the power to always threaten or demand more. Other political sponsors would not hesitate to also use the militants against the president.

Tinubu understands these things having been in the political arena in Nigeria for long. To Tinubu, it wasn’t the militants speaking or issuing threats but their political sponsors testing the waters.

The appointment of the retired naval chief to head the state in response is a clear statement.

Badgers14:
The appointee is the luckiest of all...

Retired... they just called him to come and chop

He is a naval chief and the target is the protection of the oil pipelines.

Wouldn’t this further lead to increase in oil prices?

https://apnews.com/article/israel-palestinians-hamas-war-news-ceasefire-hostages-03-17-2025-b8753b9458a44f10ab08aa9b12582780

zendi:
Brent Crude oil has just jumped from 70 to 71 in first trading after the war started on Sat/Sun night.

These downstream boys you're showing me (save Oando, a special case) should be in red because the raw material for their products (crude) is getting more expensive.

If you ask me, I think an average of $75 per barrel
would be perfect.

Nigeria's gasoline imports have dropped since the Dangote refinery started producing the road fuel in September, reaching a record-low of 112,000 bpd in February, from 372,000 bpd in February 2024, Kpler data show.

Captures domestic market according to spglobal.

“They are importing a lot less, and traders are making up the shortfall from offshore Lome" said one trader, referring to the nearby transshipment hub off the coast of Togo where traders blend product.

https://www.spglobal.com/commodity-insights/en/news-research/latest-news/crude-oil/022025-nigerias-dangote-refinery-captures-domestic-gasoline-market-share

SEPLAT settles debt to FG.

https://nairametrics.com/2025/03/16/alleged-debt-seplat-and-chorus-energy-pays-n28-7-billion-to-nigerias-federation-account-reps/

Youngzedd:
Dangote Refinery said they will list in Q1 of 2025.

Alhaji is battling with the oil cabals.


We wait....

Most likely early next year. He would first want to sign long term contracts for steady crude supply.

Streetinvestor2:
This will happen to sugar on the 200B forex loss again.How much has Naira appreciated to dollars against end of the yr exchange rate Figure. Abeg at what rate did Naira end against dollars last yr

I think the NAFEM window ended around 1537 last year. The NAFEM window as at last week Friday is 1517.

However, going by the PMI of 52 and 53 in January and February according to Stanbic Bank report, it would mean business confidence based on increased purchases and new orders is growing and is already better than 4th quarter last year. So with stable exchange rate and more sales, businesses are likely to make profits this quarter than they have ever done since Q2 2023.

chimex38:
The Nigerian Mafia
Those ones don't have crude to beg Dangote to take again.
They have sold all of them 5-10 years in advance if not more..

Shey u dey read the latest shenanigans and tit-for-tat playing out in the Crude-for-Naira Deal?
( to be or not to be going forward)

I think the mafias will be better off if crude price crashes. As they have already sold our crude 5yrs in advance at a costlier rate of $70 and above before Drill-baby-Drill ascension to power.

So weather low prices + low crude demand worldwide..
The so called mafias have secured their future clients..

They still supplied crude to Dangote refinery this past Friday though and by their statement (yet to be refuted), have supplied an average of 297k bpd since October 2024.

https://punchng.com/dangote-refinery-gets-fresh-crude-cargoes-from-nnpcl/

Nigerian food delivery startup chowdeck is expanding to Ghana, aiming to reach 52 cities across Nigeria and beyond by year-end.

With the completion of this asset take over by the Renaissance group, indigenous Nigerian firms now dominate the upstream oil sector especially onshore (at least 60%). This is laudable.