- The Petroleum Product Retail Outlet Owners Association of Nigeria (PETROAN) has accused domestic refineries of importing inferior crude
- PETROAN’s national publicity secretary, Joseph Obele, made the accusation, saying the development began after the collapse of the naira-for-crude deal
- He asked domestic refineries to prioritise the import of high-quality crude, saying Nigerian sweet crude is among the best in the world
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) has revealed that some local refineries import inferior crude oil into Nigeria to cut costs.
The association’s national publicity secretary, Joseph Obele, said the refineries have been importing crude with high sulphur content into the country.
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Refineries import crude with high sulphur content
He, however, declined to mention the names of the refineries, saying they know themselves.
Obele said the import of low-quality crude into Nigeria began after the collapse of the naira-for-crude deal between the Nigerian government and local refineries.
Punch reported that the PETROAN image maker said some refineries import substandard products to cut costs, saying the crude does not meet global standards.
PETROAN had asked refineries to prioritise high-quality crude imports as the naira-for-crude deal ends.
Nigeria's crude is among the best globally
According to the association, Nigerian Sweet Crude is among the best in the world, stating that imported crude should be of the same quality.
PETROAN said Nigerian sweet crude has less than 0.5% sulphur content and is among the world’s best.
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Obele called on the Nigerian government and upstream and downstream regulators to be on high alert and conduct thorough laboratory checks on all crude imports to ensure they meet the needed standards.
The association also asked Heineken Lokpobiri, the Minister of State for Petroleum Resources (Oil), to conduct an appraisal of the first phase of the naira-for-crude initiative to determine the next action.
He said the rise in petrol prices is temporary as the reforms caused by the Petroleum Industry Act (PIA) encourage competition in the downstream oil sector.
Nigeria’s newest crude blend to hit the market
Recall that Legit.ng reported that Nigeria’s newest crude oil blend, the medium-sweet Obodo grade, will hit the market this April.
The new blend has a gravity of 27.65 API and a sulphur content of 0.05pc, Argus Media reports.
Sources say the new grade may be priced alongside the Nigerian medium sweet Bonga blend.
According to the report, Nigerian Independent Continental Oil and Gas will produce Obodo from onshore oil block OML 150 in the Niger Delta area, while the Nigerian National Petroleum Company Limited (NNPC) will market the commodity.
Nigeria's crude faces slow acceptance in Europe
The newest Nigerian crude will add to the growing list of medium-sweet grades.
The state oil firm restarted the production of a similar Utapate blend last year after it was launched in Nembe in 2023.
Nigeria's medium-sweet blends, such as Forcados, Escravos, and Bonga, have been accepted in Europe, the largest market for Nigerian crude.
Experts say Obodo could also be accepted with European refineries, where seasonal maintenance is expected to end by April and May.
Nigeria's crude faces competition
They say Nigerian crude faced slow acceptance in the April trade cycle as the availability of cheaper alternatives, such as US WTI, Caspian CPC Blend and other Mediterranean grades, lured European buyers.
The trade cycle has reportedly shifted to May, with 15 April loading Nigerian cargoes still searching for buyers.
ThisDay reports that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) outlined plans to add 1.07 million barrels per day to Nigeria’s output by December next year.
Crude oil soars in international market
Legit.ng earlier reported that Nigerians may experience a rise in petroleum product prices in the coming days due to the increase in the cost of Brent, the global benchmark for crude.
Crude oil price is a key commodity that sets the price of refined petroleum products.
According to reports, on Sunday, January 12, 2025, Brent crude price reached $79.76 per barrel.
Proofreading by Kola Muhammed, copy editor at Legit.ng.
