• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 3 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 14 hours How Far Have We Really Gotten With Alternative Energy
  • 9 days They pay YOU to TAKE Natural Gas
  • 6 days What fool thought this was a good idea...
  • 8 days Why does this keep coming up? (The Renewable Energy Land Rush Could Threaten Food Security)
  • 4 days A question...
  • 15 days The United States produced more crude oil than any nation, at any time.
Body Heat: A New Source of Energy for Buildings?

Body Heat: A New Source of Energy for Buildings?

Governments and businesses are exploring…

Time Running Out for BHP's Anglo American Bid

Time Running Out for BHP's Anglo American Bid

The clock is counting down…

Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

Nigeria Owes Oil Majors $3 Billion For Crude Swaps

  • Nigeria owes up to $3 billion to trading giants and oil majors for the fuel-for-crude swaps with which it has been importing fuel.
  • While Nigeria is the largest oil producer in Africa, the country doesn’t have enough refining capacity to meet fuel demand.
  • As well as accumulating a large debt, Nigeria is at least four months behind schedule for its repayments in crude.
oil

Nigeria owes up to $3 billion to supermajors and trading giants for the fuel-for-crude swaps via which Africa’s biggest oil producer has been importing fuel to meet domestic demand, Reuters reported on Friday, citing executives and traders.  

Despite being the largest crude oil producer in Africa, Nigeria lacks enough refining capacity to meet all its domestic fuel demand. So the country has relied for years on the so-called Direct Purchase Direct Sale (DSDP) under which it imports fuels in exchange for crude cargoes to major trading houses and international oil majors, including BP, TotalEnergies, Vitol, and Mercuria.

Nigeria has accumulated a debt to those of around $3 billion and it is also at least four months behind schedule for the repayment in crude, according to Reuters’ sources.

Earlier this month, Mele Kyari, Group Chief Executive Officer at Nigeria’s state-owned oil firm NNPC Ltd, told Reuters that the company would wind down the crude swap contracts and pay in cash for fuel imports.       

The move came amid a major reform in the Nigerian fuel retail market after Nigeria’s new President Bola Tinubu removed the fuel subsidies the government was paying for years. The subsidy was a huge cost to the federal government, which last year paid as much as $10 billion for the difference between fuel imported at market prices and sold at discounts to Nigerians.

As private firms now import fuels, the state firm will be able to pay for its fuel imports in cash, Kyari told Reuters in early June.  

Despite the announced end to the fuel-for-crude swaps, Nigeria has yet to send the crude cargoes it still owes for previous fuel imports, and this could take months, traders and industry players said.

“Swaps will ultimately stop but not yet. We are getting our swaps crude cargo in October at the earliest,” one major market player told Reuters.

By Charles Kennedy for Oilprice.com

ADVERTISEMENT

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News