In a forward-thinking move back in July 2024, President Bola Tinubu approved the use of the naira as the payment currency for crude oil supplied by the Nigerian National Petroleum Corporation (NNPC) to the Dangote Refinery. Since the official launch of this “naira-for-crude” initiative on October 1, 2024, Nigeria has achieved a major strategic milestone, even as the global economy reels from the ongoing Iran-Israel-US conflict in the Middle East.
The Federal Government, through the technical committee on naira-for-crude—which includes the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, and the Executive Chairman of the Nigerian Revenue Service, Zacch Adedeji—has built a strong framework to ensure the initiative meets its goals: securing oil supplies, stabilizing the economy, and protecting Nigeria’s energy future.
The war between the US, Israel, and Iran has now stretched into its sixth week, creating global economic turbulence. The situation worsened when Iran closed the Strait of Hormuz, a critical shipping lane linking the Persian Gulf to the Gulf of Oman, responsible for over 20% of global oil and gas flows. This disruption has sent shockwaves across global energy markets.
Energy prices—including LPG, LNG, petrol (PMS), and diesel—have surged worldwide, putting immense pressure on households and governments alike. Countries with fewer resources are feeling this strain most, as the cost of transportation and basic goods climbs sharply.
In Nigeria, while fuel prices have risen as elsewhere, the country has avoided domestic shortages. Unlike many nations where citizens queue for days at gas stations, Nigeria’s supply of petroleum products has remained steady. In fact, several countries in Europe, Asia, and Africa—including South Africa and Kenya—now rely on Nigerian supplies through the Dangote Refinery.
Located in Lekki, Lagos, the Dangote Refinery has proven the value of local production and refining capacity for a country of Nigeria’s significance in the region. The ongoing Middle East conflict has exposed vulnerabilities in global energy supply chains, causing shortages and sharp price hikes in many markets. Nations that depend heavily on imported refined products are facing immediate disruptions.
Some examples: Vietnam is encouraging remote work to cut transportation energy costs. Thailand has ordered civil servants to conserve electricity and is considering similar requirements for private businesses. Bangladesh has closed universities early and imposed daily fuel limits. Pakistan has rolled out a four-day government workweek and temporary school closures. In India, restaurants are shutting down due to LPG shortages. Egypt requires shops and restaurants to close by 9 p.m., while the Philippines has declared a national energy emergency. Even in the United States, long fuel queues are now a common sight.
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