The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) has alleged that some local refineries are importing crude oil of inferior quality into the country as a cost-saving measure.
PETROAN’s National Publicity Secretary, Joseph Obele, stated on Thursday that these refineries are bringing in crude oil with a high sulphur content, which falls below global standards. While Obele declined to name the specific refineries involved, he indicated that they were aware of their actions and expressed hope that they would rectify the situation.
According to PETROAN, this practice of importing low-quality crude began after the Nigerian government suspended the naira-for-crude oil exchange agreement.
Obele explained, “Some refineries are importing substandard crude into the country. They do this to cut costs following the stoppage of the naira-for-crude deal. We are not going to mention any particular refinery, but when those concerned see the report, they will make corrections. Many may not know there is substandard crude. Any crude oil with high sulphur content does not meet the global standard.”
In an earlier statement, PETROAN had already urged refinery operators to prioritise the importation of high-quality crude oil as the naira-for-crude arrangement concluded.
Obele emphasised, “We urge the refinery operators to ensure that the crude oil imported meets global standards to guarantee the production of high-quality petroleum products.”
He highlighted that Nigerian Sweet Crude, known for its low sulphur content (less than 0.5 per cent), is among the best globally, questioning why imported crude should be of a lesser quality.
PETROAN voiced concerns that the importation of substandard crude oil would negatively impact the quality of petroleum products, hinder the growth of the Nigerian oil and gas industry, and ultimately harm Nigerian consumers.
The association called on the Nigerian government and regulatory bodies to be vigilant and conduct thorough laboratory analyses on all crude oil imports to ensure they meet the necessary standards. It also urged the relevant authorities to ensure refinery operators adhere to the highest operational standards, including importing high-quality crude.
PETROAN also called on the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, to review the initial phase of the naira-for-crude initiative to determine the best course of action for Nigerians.
Furthermore, PETROAN expressed serious concern over the expectation that petroleum product prices will continue to rise following the end of the naira-for-crude deal. To prevent this and ensure price stability and energy sufficiency, the association advocated for the continued openness of the refined petroleum product importation window.
Despite these concerns, PETROAN remains optimistic that the recent increase in PMS (Premium Motor Spirit) prices is temporary, citing the Petroleum Industry Act’s encouragement of competition in the downstream sector as a potential catalyst for price reduction as the market adjusts.
Obele also stated that PETROAN will proactively monitor the quality of refined petroleum products through laboratory testing to guide its members in sourcing from refineries and depots that supply standard products, thereby protecting both its members and Nigerian consumers from substandard fuels.
