Nigeria’s foreign exchange demand for oil-sector imports jumped by 114.91 per cent to $4.86bn in 2025, underscoring the country’s continued dependence on imported petroleum products and other oil-related inputs despite growing domestic refining capacity. The figure, contained in the Central Bank of Nigeria’s 2025 Annual Report and Statement of Accounts, represents a sharp increase from the $2.26bn recorded in 2024 and makes the oil sector the second-largest user of foreign exchange among visible imports.
The CBN report showed that oil-sector imports accounted for 25.91 per cent of Nigeria’s total visible import-related FX utilisation in 2025, trailing only industrial imports, which accounted for 42.11 per cent. Overall, Nigeria’s foreign exchange utilisation rose by 59.36 per cent to $42.83bn during the year, with visible imports accounting for $18.76bn. Petroleum-related imports recorded the biggest increase among major import categories, even as the country continued efforts to expand local refining and reduce its exposure to foreign petroleum supplies.
The development is particularly notable because Nigeria has significantly increased its refining capacity, led by the 700,000-barrel-per-day Dangote Petroleum Refinery. Yet, petrol imports still accounted for 62.47 per cent of the country’s total Premium Motor Spirit consumption in 2025. Of the estimated 18.97 billion litres of petrol consumed during the year, about 11.85 billion litres came through imports, while domestic refineries supplied roughly 7.54 billion litres. The picture, however, began changing in 2026, as petrol imports reportedly fell by 65.7 per cent in the first six months, with the Dangote refinery emerging as the dominant domestic supplier.
For marketers, however, the shift from imported to locally refined products is largely a question of price. Independent Petroleum Marketers Association of Nigeria spokesperson Chinedu Ukadike said marketers would naturally purchase from whichever source offers the most competitive price because of their narrow profit margins. Beyond petrol, oil-related FX demand also covers crude oil purchases, refined products, lubricants, petrochemical feedstocks, refinery equipment, catalysts and other inputs needed across the petroleum value chain. This means that expanding domestic refining alone may not immediately eliminate the sector’s broader demand for foreign exchange.
The latest CBN figures therefore highlight a key challenge for Nigeria: increasing refining capacity does not automatically translate into an immediate end to oil-related FX pressure. While the decline in petrol imports in 2026 suggests that domestic refining is beginning to change the market, exchange rates, global crude prices, local production costs and pump-price competitiveness will continue to influence where marketers source their products. For Nigeria, the bigger goal remains clear—turning its growing refining capacity into lower import dependence, stronger energy security and reduced pressure on scarce foreign exchange.
source: punch
