The Crude Oil Refinery-Owners Association of Nigeria (CORAN) has called on the Federal Government to deploy targeted fiscal and regulatory interventions to guarantee crude feedstock delivery in local currency, warning that domestic pump prices will remain volatile without structural state support.
The association presented its position in an institutional policy document detailing strategic measures required to shield local operators from severe foreign exchange pressures, prohibitive borrowing rates, and logistics deficits.
CORAN cited international regulatory precedents, pointing to a White House summit convened by President Donald Trump with major American refiners including Marathon Petroleum, Valero Energy, PBF Energy, and Delek US to address domestic refining capacity and escalating consumer gasoline costs.
International Precedent for Sovereign Downstream Intervention
The intervention by the United States government occurred while American refineries operated at approximately 90 percent capacity utilization, processing 17.5 million barrels of crude oil daily despite domestic fuel prices exceeding four dollars per gallon.
CORAN argued that if leading industrialized economies actively intervene to protect established refiners from market failures, Nigeria cannot dismiss the structural difficulties facing indigenous operators as corporate entitlement.
The association maintained that state intervention in strategic refining capacity constitutes sound economic planning and sovereign energy security rather than market distortion.
The Nigerian Crude Supply Paradox and Delivery Deficits
Nigeria remains one of Africa’s premier crude oil producers, yet domestic refining facilities consistently encounter procedural barriers when purchasing feedstock under commercially viable terms.
Official regulatory records from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) show that during the first quarter of 2026, authorities allocated 61.9 million barrels of crude to local refiners, with upstream producers offering 66.7 million barrels.
Actual physical deliveries during that period reached only 28.5 million barrels because wide pricing differentials between upstream exploration companies and downstream processors stalled completed transactions.
Performance improved during the second quarter of 2026, when NUPRC recorded deliveries of 53.7 million barrels of crude oil and condensate to local plants, achieving a 97.4 percent Domestic Crude Supply Obligation compliance rate.
CORAN emphasized that statutory volume allocations alone do not stabilize operations if commercial pricing formulas, marine transportation costs, and clearing mechanisms fail to reflect local operating economics.
The association endorsed ongoing technical discussions between NUPRC and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to execute domestic crude swaps that pair refining facilities with nearby producing oil fields to eliminate unnecessary maritime freight fees.
Preserving the Naira-for-Crude Framework
CORAN reaffirmed its commitment to the Federal Government’s Naira-for-crude initiative, stating that transactions must remain anchored strictly in domestic currency to protect local currency reserves from excessive import drains.
Because indigenous refineries build infrastructure within Nigerian territory, employ national labor, and pay taxes locally, exposing crude acquisitions to dollarized payment cycles undermines national currency stability.
The association warned that the policy framework must incorporate practical pricing safeguards and liquidity structures so operating margins are not eroded by hidden administrative charges.
Sustaining the domestic currency mechanism allows local plants to stabilize production schedules without facing foreign exchange liquidity shortages in the official currency market.
Structural Interventions Required Beyond Crude Access
CORAN outlined five operational areas requiring direct executive intervention to ensure long-term stability across the downstream sector.
The association requested specialized, single-digit interest credit lines with extended repayment moratoriums to finance downstream facility expansions and routine plant turnarounds.
Operators requested targeted tax credits and investment allowances designed to attract industrial capital into secondary refining and petrochemical processing.
The group identified physical logistics as an urgent priority, urging the state to construct and rehabilitate shared pipeline infrastructure, coastal storage installations, industrial power connections, and maritime docking terminals.
CORAN urged regulatory agencies to eliminate duplicate permitting fees and bureaucratic delays by creating a unified, multi-agency compliance portal across midstream and downstream activities.
The association advised federal authorities to enact enforceable local content regulations that mandate the transfer of advanced refining engineering, chemical technology, and technical design capacity to Nigerian personnel.
Strategic Economic Realities and the Refined Product Market
CORAN stated that exporting unrefined crude oil while simultaneously importing refined petroleum products imposes severe economic losses that drain foreign reserves and export manufacturing employment.
The association stressed that national petroleum reforms must focus on domestic value addition, allowing local processors to satisfy domestic consumer demand before exporting finished petroleum products to regional African markets.
CORAN affirmed that long-term fuel price stability depends on cooperative engagement between regulators, upstream producers, and domestic refiners rather than commercial confrontation.
