By Nchetachi Chukwuajah
The House of Representatives Committee on Petroleum Resources (Downstream) has raised the alarm over an imminent return of fuel scarcity, queues and price hike if urgent steps are not taken to address crude supply challenges to domestic refineries.
Chairman of the committee, Honourable Ikenga Ugochinyere, stated this during a media chat held in Abuja, on Thursday, March 19.
Ugochinyere described the situation as a major threat to economic stability and the welfare of Nigerians.
He warned that if the issues remain unresolved within 48 hours, the country could witness a resurgence of fuel queues, supply disruptions and worsening hardship driven by higher pump prices.
The lawmaker disclosed that findings from the committee’s oversight activities showed that there is the likelihood of an increase in the price of fuel driven by critical supply chain inefficiencies.
He said one of the issues of concern is the inadequate supply of crude oil to the Dangote Refinery, which remains central to Nigeria’s efforts to stabilise fuel supply.
Ugochinyere disclosed that while the refinery is entitled to about 21 cargoes of crude oil and requires at least 15 to operate optimally, it is currently receiving only five cargoes.
“This shortfall is already undermining refining capacity and poses a direct risk to fuel availability across the country,” he said.
The committee also expressed concern over the quality of crude oil being supplied to the refinery, saying it is substandard for a refinery of such scale and national importance.
It stressed that domestic refineries, particularly the Dangote Refinery, must be prioritised for high-grade crude sourced from the Niger Delta to ensure efficiency and optimal output.
The committee also raised concerns about the rising cost burden on local refineries due to international trading intermediaries.
According to Ugochinyere, domestic refiners pay a premium of over $18 per barrel to foreign trading companies, a sharp increase from the previous $2–$4.
He said, “Crude oil produced in Nigeria is being sold to our refineries through middlemen based in London and Dubai, who add no value but collect huge fees.
“For every barrel priced at $100, refineries pay $118, with the additional $18 going to intermediaries.”
The lawmaker said the practice is exploitative, warning that the additional costs are ultimately transferred to consumers through higher fuel prices and reduced supply stability.
To avert a looming crisis, the committee called on the Presidential Technical Committee on the Crude-for-Naira initiative to reconvene within 48 hours to resolve the supply bottlenecks.
The committee also advocated the immediate restoration of adequate crude supply to domestic refineries, strict enforcement of the Domestic Crude Oil Supply Obligation under the Petroleum Industry Act (PIA) 2021, and an urgent review of crude quality standards.
Ugochinyere appealed to President Bola Tinubu to issue a stronger executive directive to ensure compliance and safeguard Nigeria’s domestic energy supply chain.
