“Naira For Crude” will reduce the need for the US dollar.

The renowned Nigerian billionaire businessman Aliko Dangote praised the “Naira for Crude” initiative introduced by the Nigerian government, which allows refineries to purchase crude oil using the Nigerian Naira instead of US dollars. He emphasized that this will help stabilize the Naira by reducing the demand for foreign exchange by 40%.

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During the announcement of petrol production at the Dangote Refinery in Lagos on Arise TV, he appreciated the efforts of the President of Nigeria, Bola Tinubu, for creating an environment for the refinery to grow and provide energy for the people, stating,

 “I would like to salute the people of Nigeria and the government of President Bola Tinubu for creating the environment for us to thrive and also achieve this monumental feat of giving energy to our people for growth and prosperity.”

The Effects of the Initiative

He further opined that the initiative will have two very significant impacts on the country’s development:

Firstly, it will ensure the stabilization of the Nigerian Naira, as the use of US dollars for crude oil purchases will be reduced substantially by 40%. In his words:

“I want to thank President Bola Tinubu for creating this idea of naira for crude and naira for the product. Doing that will give a lot of stability to the naira and remove 40 per cent of the demand for dollars. That’s not just it; there is a lot of round-tripping.”

Secondly, he noted: “Now that we have this refinery working, it will show the true consumption of Nigeria. We can track each loaded truck, and we will try as much as possible to track the loaded ships. Trucks, we can tell you where they are, and for some of the products we have, we can tell you the consumption.” 

This means the refinery’s operations will be more transparent, and the fuel production and fuel consumption of the country can be better tracked.

Optimum Availability of Oil in Nigeria

Once fully operational, the Dangote Refinery will have the capacity to process 650,000 barrels of oil per day, with over half of that output being converted into petrol. 

Additionally, Nigeria’s condensate and crude oil reserves have grown significantly to 37.5 billion barrels, providing about 68 years of oil reserves at the current consumption rate for the country.