7-month Petrol Stock Shortfall Sparks Year-end Supply Concern

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Nigeria’s petrol stock cover has remained below the 30-day safety benchmark for seven consecutive months, raising concerns about possible supply constraints towards the end of the year as petroleum marketers reportedly reduce imports amid claims that banks have declined to issue Letters of Credit (LCs) to importers.

The concerns come as data from the September 2026 factsheet of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) show declining petrol imports and domestic deliveries ahead of the festive season.

According to the factsheet, petrol stock cover stood at 23.9 days in September, up from 22.9 days in August but still 6.1 days below the required 30-day threshold.

Stock cover fell from 30.9 days in February to 21.2 days in March, before reaching its lowest point of 16.2 days in May. It has since risen for four consecutive months, increasing to 19.6 days in June, 22.4 days in July, 22.9 days in August and 23.9 days in September.

The average stock cover over the seven-month period was approximately 20.6 days. Inland depots accounted for 22.7 days of the September cover, while the NMDPRA’s calculation also included petrol stocks at the Dangote refinery.

Despite remaining below the safety benchmark, the September position was better than the corresponding period last year, when stock cover stood at 16.9 days before falling further to 11.1 days in October 2025.

However, the pace of recovery has slowed. Stock cover increased by 2.8 days between June and July, but the gains narrowed to 0.5 days in August and one day in September.

The concerns follow a 30 per cent decline in petrol imports in September, from 14.6 million litres per day in August to 10.2 million litres per day, as approved import permit volumes were reportedly being exhausted.

Total petrol receipts fell by 23 per cent, from 50.5 million litres per day in August to 38.7 million litres per day in September, while consumption increased by seven per cent to 44.4 million litres per day.

Domestic petrol receipts also declined by 21 per cent, from 35.9 million litres per day to 28.5 million litres per day. This meant the market received 11.8 million fewer litres of petrol daily in September than in August.

The decline occurred despite a 13 per cent increase in petrol production at the Dangote Petroleum Refinery, which raised its average daily output from 41.94 million litres in August to 47.22 million litres in September.

The refinery’s average capacity utilisation also increased from 105.21 per cent to 105.98 per cent, above its installed capacity of 650,000 barrels per day.

However, the increase in production did not translate into higher domestic deliveries. Dangote’s domestic petrol supply fell by about one-fifth, while its petrol exports rose by 59 per cent, from 9.73 million litres per day in August to 15.47 million litres per day in September.

The refinery also added 3.25 million litres per day to its petrol stocks, ending September with 366.2 million litres, compared with 360.4 million litres at the end of August.

The reduction in petrol imports has raised concerns about possible supply disruptions, particularly as demand typically increases towards the end of the year.

With petrol stock cover remaining below the 30-day benchmark for seven months, analysts fear that a further decline in supplies could trigger domestic shortages as the festive season approaches.

However, the Secretary of the Major Energy Marketers Association of Nigeria (MEMAN), Clement Isong, did not immediately provide a specific explanation for the sharp decline in imports by the association’s members.

Responding to an enquiry by LEADERSHIP, Isong said: “Let me cross-check and find out. However, I am trying to put your concerns in perspective and come up with proper analysis.”

An industry source who also imports petroleum products, however, told LEADERSHIP that some financial institutions had declined to issue Letters of Credit to petroleum marketers.

Although the source could not confirm the reasons for the alleged refusals, another industry source claimed that banks were being pressured or coerced into denying importers access to the credit facilities.

The Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, offered a different explanation, suggesting that the decline in imports could be linked to rising crude oil prices, which were around $115 per barrel.

“I will say that it’s all about business decisions and also concerns by financial institutions not to run the risk of losing money,” Yusuf said.

He explained that businesses and financial institutions had to consider the risks of committing funds to a commodity whose price was volatile.

Yusuf also cautioned that ongoing discussions between the United States and Russia could trigger a sudden fall in crude oil prices, potentially leaving importers with substantial losses if they purchased products at higher prices.

Meanwhile, the National President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Prince Dr Billy Gillis-Harry, played down fears of possible shortages, saying the NMDPRA had taken steps to safeguard supply.

Speaking to LEADERSHIP, he said the regulator had the necessary data to monitor supply and would ensure that any shortfall was addressed through imports or domestic sourcing.

Figures from last year illustrate how sharply petrol demand can rise towards the end of the year, potentially putting additional pressure on current stock levels.

Petrol consumption, measured by volumes trucked out, increased from 43.8 million litres per day in September 2025 to 56.7 million litres per day in October, peaking at 63.7 million litres per day in December.

Consumption in September 2026 stood at 44.4 million litres per day. A return to December 2025 levels would therefore represent an increase of approximately 43 per cent.

Last year, petrol stock cover recovered to 29.3 days in December and 33 days in January following increased supplies. Daily receipts reached 71.5 million litres in November and 74.2 million litres in December, including imports of 52.1 million litres and 42.2 million litres per day, respectively.

Based on September’s stock cover and consumption figures, current petrol stocks were estimated at approximately 1.06 billion litres. At December 2025’s consumption rate of 63.7 million litres per day, that volume would last about 16.7 days.

Maintaining 30 days of stock cover at that level of consumption would require approximately 1.9 billion litres of petrol.

Any additional import cargoes would be priced against prevailing market benchmarks. In September, dated Brent crude was quoted at $116.77 per barrel, while the naira traded at N1,327.31 to the dollar.

Indicative petrol pump prices ranged from N1,371.01 per litre in Lagos to N1,464.75 per litre in Maiduguri.

The supply position for cooking gas, also known as liquefied petroleum gas (LPG), was tighter than that of petrol, with stock cover remaining significantly below the regulatory benchmark.

LPG stock cover stood at 15.9 days in September, 14.1 days below the threshold, while consumption was reported at 133.3 per cent of the benchmark.

Daily LPG receipts rose by nine per cent to 4.7 kilotonnes, driven by a 50 per cent increase in domestic supply to 4.5 kilotonnes. Imports, however, fell by 85 per cent to 0.2 kilotonnes.

Domestic sources accounted for approximately 96 per cent of LPG receipts, while consumption increased by eight per cent to 5.2 kilotonnes per day.

In contrast, diesel and aviation fuel maintained stock levels above the safety threshold. Diesel stock cover stood at 49.7 days, while aviation fuel cover was 53.2 days.

Despite the relatively comfortable stock position, daily diesel receipts fell by 40 per cent, from 14.5 million litres in August to 8.7 million litres in September, the lowest level recorded in the 13 months covered by the regulator’s data.

Domestic diesel receipts declined by 39 per cent, from 13.2 million litres to 8.1 million litres per day, while imports fell by 54 per cent, from 1.3 million litres to 600,000 litres per day. Consumption, however, edged up from 14.3 million litres to 14.5 million litres per day.

Dangote’s diesel production increased by 35 per cent to 24.32 million litres per day. However, its domestic deliveries fell from 12.37 million litres to 8.14 million litres per day, while exports rose by 82 per cent, from 8.75 million litres to 15.91 million litres per day.

The refinery ended September with 232.5 million litres of diesel in stock, compared with 137.2 million litres at the end of August.

1. The Stock cover is still below safe levels. Petrol cover was 23.9 days in September, 6.1 days short of the 30-day benchmark. It has stayed below that mark for seven straight months. It hit a low of 16.2 days in May and has risen every month since, though the pace of recovery is slowing.

2. Imports are falling. Petrol imports dropped 30 per cent in September, from 14.6 to 10.2 million litres per day, as approved import permit volumes ran out. Total receipts fell 23 per cent to 38.7 million litres per day, while consumption rose 7 per cent to 44.4 million.

3. Dangote is producing more but delivering less locally. The refinery raised output 13 per cent to 47.22 million litres per day, yet its domestic petrol supply fell by about one-fifth. Its petrol exports jumped 59 per cent to 15.47 million litres per day, and it added to its own stock.

4. Why marketers cut imports is disputed. One industry source says banks have declined Letters of Credit to importers. Another alleges banks are being pressured to do so. The reasons are unconfirmed, and MEMAN’s secretary, Clement Isong, did not explain the drop. CPPE’s Dr Muda Yusuf says it is a business decision: crude is about $115 per barrel.

5. The festive season is the real risk. Last year, consumption rose from 43.8 million litres per day in September to 63.7 million in December. A repeat would mean about 43 per cent more demand. At that pace, current stock of about 1.061 billion litres would last only about 16.7 days. Holding 30 days’ cover would need about 1.9 billion litres.

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