President Bola Tinubu has approved a new policy to sell crude oil in Nigeria using the local currency, Naira.
This directive aims to reduce the country’s dependence on foreign currency for oil transactions.
The Chairman of the Federal Inland Revenue Service, Zacchaeus Adedeji, announced this change to reporters on Monday after the Federal Executive Council meeting at the Presidential Villa in Abuja.
Adedeji said, “Effective immediately, the Nigerian National Petroleum Company Limited will now conduct transactions with local refineries in Naira. This includes the sale of crude oil to Dangote Refinery, and Dangote’s subsequent sales will also be in Naira.”
He explained that this decision is intended to reduce Nigeria’s heavy reliance on foreign exchange for crude oil imports, which currently consumes about 30 to 40 percent of the country’s forex expenditure. “By using Naira for these transactions, we expect to save around $7.3 billion annually,” Adedeji added.
He also noted that this policy will help stabilize domestic crude oil prices by lessening the impact of foreign exchange fluctuations. “The new policy should ease pressure on Nigeria’s foreign exchange reserves, lowering monthly forex expenditure from $50 million to around $600 million,” Adedeji said.
Afreximbank has been chosen as the pilot settlement bank to handle these transactions as part of the new implementation.
