Nigeria’s foreign exchange demand for oil-related imports has surged by about 115 per cent, raising fresh concerns over the country’s continued dependence on international petroleum supplies despite efforts to increase domestic production and refining capacity.
The development highlights a paradox at the heart of Nigeria’s oil economy: while the country remains one of Africa’s major crude oil producers and has significantly expanded its domestic refining capacity, substantial amounts of crude and petroleum products are still being sourced from abroad.
Recent data show that Nigeria’s crude oil imports rose dramatically in the first quarter of 2026.
According to Central Bank of Nigeria balance-of-payments data reported by
Media reports within the country has it that crude imports increased from about $340 million in the fourth quarter of 2025 to $1.39 billion in the first quarter of 2026, representing a 308.8 per cent quarterly increase.
The rising import bill is particularly significant because domestic refining capacity has expanded considerably, led by the Dangote Petroleum Refinery.
The 700,000-barrel-per-day facility has become a major source of refined petroleum products, but it has also faced difficulties securing sufficient Nigerian crude.
Reuters reported in July that the refinery had received only seven crude cargoes in May, compared with the 13 to 15 cargoes it needs monthly to operate at its required level.
The shortage forced the refinery to source crude internationally at dollar-denominated prices.
The situation has significant implications for Nigeria’s foreign exchange market.
When refineries and petroleum marketers purchase crude or refined products overseas, payments are generally made in dollars, increasing demand for foreign currency and potentially placing additional pressure on the naira.
The problem is not simply a lack of crude production.
Analysts have pointed to weaknesses in the domestic crude supply chain, including pricing disputes, contractual arrangements, logistics challenges and difficulties in implementing the Domestic Crude Supply Obligation.
A 2026 working paper from Nigeria’s National Institute for Legislative and Democratic Studies noted that domestic refinery operators received less than 55 per cent of the crude volumes they requested, despite national crude production exceeding 1.6 million barrels per day.
Nigeria’s petroleum-import problem has also resurfaced in the downstream market. NMDPRA data showed that petrol imports increased from an average of 5.9 million litres per day in May to 18.1 million litres per day in June, a 206.8 per cent monthly increase.
At the same time, domestic petrol receipts fell by 21.7 per cent.
The renewed import dependence threatens to undermine one of the key objectives of Nigeria’s petroleum-sector reforms: reducing the country’s reliance on imported fuel while conserving scarce foreign exchange.
Experts say the solution requires stronger integration between Nigeria’s upstream and downstream petroleum sectors.
Ensuring that domestic refineries receive adequate crude at commercially viable prices would reduce the need for costly international purchases and help retain more foreign exchange within the Nigerian economy.
For Nigeria, the challenge is therefore no longer simply producing more crude.
It is ensuring that sufficient locally produced crude reaches local refineries, allowing the country to convert its oil resources into refined products without continually increasing its demand for scarce foreign currency.
