The Crude Oil Refineries Association of Nigeria (CORAN) has issued a stark warning about the country's deepening dependence on imported petroleum products, a trend it describes as a major disservice to local investors who have committed billions to building refineries.
Staggering Import Costs Double in One Year
In a position paper released on Tuesday, 7 January 2026, CORAN disclosed that Nigeria spent an estimated N15.4 trillion on petrol imports in 2024. This figure represents a dramatic increase, more than doubling the N7.5 trillion recorded in 2023. This surge in expenditure occurred simultaneously as local refinery companies poured tens of billions of dollars into constructing and upgrading domestic refining infrastructure.
The association emphasized that local operators, encompassing large-scale, modular, and mid-scale facilities, have shown "true faith" in Nigeria's downstream sector by establishing permanent industrial assets. Unlike trading operations, these refineries represent fixed investments in steel, concrete, and complex distillation units that cannot be easily moved or sold without significant loss.
Importers' Short-Term Gain vs. Refiners' Long-Term Pain
CORAN drew a sharp contrast between the two models. It stated that refining is a capital-intensive, high-risk segment of the petroleum value chain. Investors must navigate crude supply fluctuations, foreign exchange volatility, inconsistent policies, and daily operational challenges.
"A refinery is not a trading strategy; it is an industrial declaration of confidence in Nigeria’s future," the association asserted.
Conversely, CORAN accused importers of historically relying on short-term strategies that generated profit without building national capacity. During the fuel subsidy era, importers benefited from price arbitrage, preferential forex access, and subsidy reimbursements, leading to billions of naira leaving the economy with no corresponding investment in local refining.
Post-Subsidy Reality and the Call for Policy Action
Even after the subsidy removal, the import dependency persists. Citing National Bureau of Statistics data, CORAN noted that over 20 billion litres of Premium Motor Spirit (PMS) were imported in 2023. The colossal N15.4 trillion import bill for 2024 highlights the scale of foreign exchange outflows that could have been retained domestically to support refining, logistics, storage, and job creation.
The association criticized the diversion of importers' profits into real estate, financial portfolios, and upstream oil field acquisitions, where crude is often exported instead of being refined locally. This approach, CORAN argued, prioritizes short-term returns over long-term industrial development.
CORAN has called on the federal government to implement decisive measures, including:
- Guaranteeing transparent and reliable crude oil allocations for domestic refineries.
- Aligning foreign exchange and pricing mechanisms to ensure a level playing field.
- Restricting import licenses only to situations where domestic supply cannot meet demand.
These steps, CORAN contends, are essential to prevent local refiners from being structurally disadvantaged against importers who face minimal industrial risk and to finally secure Nigeria's energy future.
