Africa’s largest refinery, the Dangote Petroleum Refinery, spent an estimated $4.48 billion importing 40.4 million barrels of crude oil over a two-month period, highlighting the massive scale of its operations and its growing influence on Nigeria’s energy market. Official records released by the refinery show that 21.47 million barrels were imported in May 2026, while another 18.93 million barrels arrived in June, as the company moved to clarify concerns about how fuel prices are determined in the country.
The figures reveal a significant drop in crude procurement costs between the two months. The refinery’s average landed cost per barrel fell from $124.80 in May to $95.25 in June, representing a nearly 24 percent decline. Industry observers attribute the reduction to softer global crude prices, improved freight conditions, and a larger share of lower-cost West African crude grades entering the refinery’s supply mix.
Data from the refinery shows that crude supplies were sourced from a diverse range of local and international producers, including Bonny Light, Qua Iboe, Forcados, Amenam, Escravos, Agbami, Cabinda, and Libya’s El Sharara blend. While some May shipments exceeded $130 per barrel, several June cargoes arrived below the $95 mark, helping to ease overall costs and improve refining economics.
Dangote Refinery said the disclosure was necessary to counter the misconception that fuel prices automatically rise or fall with daily international oil market movements. According to the company, crude oil is purchased weeks or even months before processing under contracts linked to monthly average pricing structures rather than spot market rates. As a result, petroleum products currently being sold are still being produced from previously acquired higher-cost crude inventories.
Despite elevated procurement expenses, the refinery stated that it absorbed a substantial portion of the cost increases instead of passing them directly to consumers, helping to stabilize the local market and reduce inflationary pressures. The company expressed optimism that Nigerians could see further fuel price moderation in the coming months as lower-cost crude inventories enter its refining cycle. It maintained that its long-term goal remains strengthening Nigeria’s energy security, reducing reliance on imported petroleum products, conserving foreign exchange, and delivering competitively priced fuel to consumers.
source: punch