The Crude Oil Refinery-owners Association of Nigeria (CORAN) has called on the Federal Government and the Presidential Committee overseeing the Naira-for-Crude initiative to expand the policy to cover modular refineries nationwide.
The appeal comes amid rising global crude oil prices linked to heightened geopolitical tensions in the Middle East, developments that have directly influenced domestic Automotive Gas Oil (AGO), also known as diesel.
Diesel Price Pressures and Economic Impact
CORAN noted that AGO remains one of the most critical fuels underpinning Nigeria’s economy. Diesel powers manufacturing plants, agricultural operations, construction activities, telecommunications infrastructure, and small and medium-scale enterprises. It is also widely used in households and serves as the primary fuel for transporting agricultural produce from rural areas to urban markets.
According to the association, sustained increases in diesel prices typically translate into higher food inflation, elevated production costs, and added financial pressure on households and businesses.
Call for Broader Policy Coverage
While acknowledging that the current Naira-for-Crude framework has offered some support to the downstream sector, CORAN argued that the limited scope of the policy has constrained its broader economic impact.
The association urged the Federal Government to incorporate modular and independent refineries into the initiative, including facilities operated by Aradel Holdings Plc, OPAC Refinery, Walter Smith Refinery, and Edo Refinery and Petrochemicals Company.
CORAN stated that expanding the policy would enable modular refiners to access crude oil feedstock in naira, thereby reducing exposure to foreign exchange volatility. It added that greater access to locally priced crude would improve capacity utilization, increase AGO output, and lower operational costs.
The association further noted that improved local refining activity could enhance supply reliability in the domestic market and reduce dependence on imported refined products.
Energy Security and Market Stability
CORAN emphasized that modular refineries were licensed to strengthen Nigeria’s energy security, promote local value addition, and cut down refined product imports. However, it said inconsistent and non-competitive crude supply has limited their ability to cushion market shocks.
The association described the proposed expansion of the Naira-for-Crude initiative as an economic stabilization measure rather than a sector-specific adjustment. It argued that enabling indigenous refiners to operate at optimal levels would help moderate the impact of global oil volatility on domestic diesel prices, support food supply chains, and sustain industrial productivity.
CORAN therefore urged the Federal Government and the Presidential Committee to act swiftly in broadening the framework to fully integrate modular refineries.