NUPRC Mulls Crude Oil Swap to Enhance Refinery Supply Chain

In a bid to optimize the supply of crude oil to Nigerian refineries, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has initiated consultations with key industry stakeholders. The proposed arrangement involves a domestic crude oil and gas swap, which aims to reduce supply costs and increase the availability of crude oil to local refineries. According to the NUPRC Chief Executive, Oritsemeyiwa Eyesan, this initiative is expected to enhance compliance with the Domestic Crude Supply Obligation and Domestic Gas Supply Obligation. Eyesan disclosed this during a courtesy visit to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) in Abuja. The proposed swap arrangement would enable crude oil producers with export facilities to meet the obligations of producers closer to domestic refineries, thereby eliminating the need for unnecessary transportation of crude oil across the country. As Eyesan explained, 'The swap works by allowing producers with export facilities to meet the obligations of those closer to domestic refineries, thereby reducing the need for physical transportation.' The NUPRC has reported a significant improvement in crude oil deliveries to domestic refiners, with 53.7 million barrels supplied between April and June 2026, representing 97.4% performance under the DCSO during the second quarter. Despite this improvement, crude oil imports continue, with some refiners relying on foreign crude to sustain operations. Eyesan noted that the persistence of imports has made it necessary to explore more efficient mechanisms for allocating and delivering domestic crude to refineries. The NMDPRA Chief Executive, Rabiu Abdullahi Umar, commended the NUPRC for improving enforcement of domestic crude supply to local refineries, stating that pricing remains a major consideration in domestic crude transactions. The proposed crude oil swap arrangement is part of ongoing efforts by regulators to ensure that increasing domestic refining capacity is matched by reliable and competitively priced crude supplies.