The CEO of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, says the ongoing instability in global oil markets is negatively impacting Nigeria’s economy.
He said while falling petroleum product prices may benefit consumers, the broader economic consequences are severe for Nigeria, which heavily relies on oil exports.
“As consumers, we are happy that the price is coming down, but…as a nation, it’s not good for our economy because our revenue inflow is also impacted,” Ahmed told State House Correspondents at the Meet-the-Press briefing series organised by the Presidential Communications Team at the Aso Rock Villa, Abuja, on Tuesday.
“Most importantly, what is even destabilising the market is inconsistencies in the way the USA President Donald Trump also sends his policies. He moves today. Tomorrow, he reverses. So, it’s been challenging to predict the next level,” Ahmed explained.
He cited a recent sharp drop in prices—from $73 to $60 per barrel in a single day—as an example of how revenue inflows are being disrupted.
Further compounding the crisis are domestic challenges, including pipeline vandalism and reduced production, he argued.
His comments follow recent OPEC reports indicating that Nigeria’s oil output has fallen to approximately 1.4 million barrels per day.
In recent weeks, Trump’s aggressive trade policies—including sweeping tariffs on goods from several nations, especially China, and threats of levies on other countries—have injected uncertainty into global markets.
These measures, often abruptly announced or reversed, have disrupted supply chains and investor confidence, contributing to fluctuations in commodity prices, including crude oil.
The oil market, already sensitive to geopolitical tensions and demand shifts, has seen added volatility as Trump’s tariffs and waivers sway economic forecasts.
For instance, when tariffs were imposed, oil prices often dipped on fears of slowed global growth, while exemptions or rollbacks triggered temporary rebounds.
Pundits say such instability complicates long-term planning for oil-dependent economies like Nigeria, where revenue hinges on steady crude prices.
The NMDPRA Chief told journalists: “Recently, as we all know, the global oil market – not only the oil market but the global economy – has been a bit volatile in the sense of the new American government’s policy of tariffs, not only targeted at China but at the whole world.
“Investors and traders not only in the oil and gas industry but also in the general economies of the world are moving left and right to the extent that some are doing day trading. That means you do your trading today. You close by the end of today because you never know what tomorrow’s policy will drive the market into.
“So the crude oil and petrol products market continues to have a downward trajectory because of these inconsistencies and policies of the government of the United States, and the key aspect of it is the aspiration of the American president to ensure that the crude oil pricing, or the crude oil price, comes down to maybe below $50 a barrel; that’s why he encourages more exploration in his country.”
Turning to the local implications, Ahmed acknowledged that while lower product prices benefit Nigerian consumers, the overall impact on the economy is negative.
He said, “So how does it relate to our own local industry regarding crude oil pricing, product pricing, demand and supply? We see a downward trajectory in terms of product pricing and crude oil pricing.
“So, we are happy as consumers of the derivatives of product pricing that the price is coming down, but when you look at it globally as a nation, it’s not good for our economy because our revenue inflow is also impacted.
“If the crude oil price, like what happened some Fridays ago, where it dropped in one day from about $73 a barrel to $60, you can see that in terms of our crude oil production, our revenue is impacted severely.”
The NMDPRA chief urged stakeholders to prepare for prolonged uncertainty in the oil sector.
He added, “This volatility will continue because as recently as yesterday, when President Trump again exempted some sectors from tariffs, particularly to China, like in terms of vehicular tariffs, you saw the market again start to go up.
“So, this is how it will continue to show, just to give you a general perspective of the oil industry.
“We recently had a report from OPEC that Nigeria’s production has come down to about 1.4 million barrels a day. If we lose the price by $10, you can see the negative impact on our economy, national reserves, and the strength of our naira. Again, when you look at the product market, we are happy to say, oh, the price is coming down.”
In a similar vein, Ahmed revealed that imports of premium motor spirit (petrol) have plunged from 44.6 million litres a day in August 2024 to 14.7 million by 13 April 2025—a fall of roughly 30 million, or 67 per cent, according to the latest Nigerian Midstream and Downstream Petroleum Regulatory Authority supply tracker.
This was as local supply rose 670 per cent within that period.
Ahmed said after contributing virtually nothing in August, local plants delivered 26.2 ML/day in early April, a jump from the 3.4 ML recorded in September, the first month with measurable output.
He hinged the surge on the phased restart of the Port Harcourt Refining Company in late November and incremental volumes from modular refineries.
Despite the progress, combined supply crossed the government’s 50 ML/day consumption benchmark only twice in the eight-month window—November (56 ML) and February (52.3 ML).
In March it slipped just below target at 51.5 ML, and in the first half of April, it remained short at 40.9 ML.
Figures from the NMDPRA also showed the balance among the three sources of PMS —Oil Marketing Companies, Dangote refinery and the Nigerian National Petroleum Company Limited — fared since last October.
OMCs raised average daily imports from about 22 million litres in October 2024 to roughly 30 million litres in December, settling in the mid 20s.
They now account for 55 60 per cent of all petrol on most days.
Meanwhile, deliveries from the Dangote Petroleum Refinery and Petrochemicals rose steadily from 10 ML/day in October to around 22 ML in January and February before easing to 18 ML by mid April 2025.
The plant now meets about two fifth of national demand.
From 24 ML/day in October, the NNPCL volumes fell monthly, slipping to 1 ML in January and zero recorded supply after February, Ahmed revealed in his slide presentation.
The NMDPRA Chief argued that the authority only grants import licences relative to the country’s supply requirements.
On refining operations, he explained that six licensed private and four public refineries currently produce 1.12 million barrels per day.
Six licensed private plants account for 679,500 bpd of the total.
The Dangote single train complex refines 650,000 bpd.
Other modular sites include Aradel (11,000 bpd), OPAC (10,000 bpd), Waltersmith (5,000 bpd), Duport Midstream Limited (2,500 bpd) and Edo Refining and Petrochemicals Company Limited (1,000 bpd).
State owned facilities add 445,000 bpd.
The refurbished Port Harcourt complex (150,000 bpd), Warri (125,000 bpd), Kaduna (110,000 bpd) and the old Port Harcourt unit (60,000 bpd) make up the Nigerian National Petroleum Company Limited’s share.
The NMDPRA said it has issued 47 licences to establish covering 1.75 million bpd and 30 licences to construct for 1.23 million bpd.
Only four plants currently hold licences to operate, and these together have a 27,000-bpd steady output.
Ahmed said five LTC projects with a combined capacity of 689,500 bpd are at the commissioning or construction stage, including Dangote with 650,000 bpd.
Smaller builds include AIPCC Energy’s 30,000 bpd plant and Waltersmith’s 5,000 bpd second train.
