The Federal Government has said that it is not true that it has discontinued the naira-for-crude policy.
The naira-for-crude policy initiative was designed to ensure supply stability and to optimize the utilisation of local refining capacity.
The government said reports suggesting that the naira-based crude oil supply arrangement with local refineries has been discontinued, thereby forcing the domestic refineries to rely solely on international crude purchases, is false.
According to a statement personally signed by the Chairman, Technical Sub-Committee, for the implementation of the policy, Dr. Zacch Adedeji, these reports do not reflect the realities of the ongoing work under the Federal Executive Council initiative on domestic sales of crude oil and refined products in naira.
“As the committee driving the implementation of this laudable initiative, we wish to provide an update on the Federal Executive Council initiative and confirm that, the Naira-Based Domestic Sales framework remains in place, there has been no decision at the policy level to discontinue this approach nor is it being considered,” he said, adding, “After implementing the policy for some months, evidence abounds that it is the right way to go and it will continue to help the economy.”
Adedeji who is also the Chairman of Federal Inland Revenue Service (FIRS), also said that local refineries have not been excluded from domestic crude supply, insisting that the engagement process for crude oil supply to domestic refineries remains in place by structured agreements, balancing factors such as availability, demand, and market conditions.
“There is no exclusion of local refineries from access to domestic crude,” he said. “The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is actively ensuring compliance with the domestic crude oil obligations provisions of the Petroleum Industry Act (PIA).
“The Initiative supports competitive pricing and market efficiency. The policy framework enabling the sale of crude oil in naira for domestic refining remains in force.”
He said the framework for domestic crude transactions is designed to promote a competitive and efficient pricing environment, noting that the Committee continues its work on strengthening implementation of the policy.
“We remain committed to ensuring the efficient execution of this initiative in line with its core objectives – enhancing local refining, reducing foreign exchange exposure, and stabilising the domestic fuel supply,” Adedeji concluded.