FG won’t fix crude oil price — NUPRC
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has reiterated that it will not resort to fixing crude oil prices, maintaining its commitment to international best practices and the willing-seller, willing-buyer model.
Speaking at a stakeholders’ meeting in Abuja, Engr Gbenga Komolafe, the Commission Chief Executive, reaffirmed that the government would support the optimal functioning of the upstream sector without intervening in price-setting.
He assured that the Commission remained open to addressing operational issues raised by industry stakeholders, provided they align with national interest and contribute to sectoral growth.
The meeting, attended by the NUPRC, members of the Oil Producers Trade Section (OPTS), and the Independent Petroleum Producers Group (IPPG), focused on fine-tuning domestic crude supply obligations between producers and refiners.
The regular gathering aims to enhance Nigeria’s energy security while ensuring that the upstream sector operates effectively within legal frameworks and accommodates the commercial interests of all stakeholders.
During discussions, OPTS and IPPG sought clarifications on various operational challenges, including the pre-allocation of crude oil to domestic refiners, pre-existing contracts within the domestic crude supply obligations, and pricing concerns.
Komolafe reassured stakeholders that the NUPRC remains committed to regulation without arbitrary actions that could deter investment or hinder sectoral growth.
He recalled that in January, the Commission had introduced a five-point agenda designed to increase oil production in 2025. This strategy includes implementing initiatives to boost production by one million barrels, enhancing transparency and accuracy in hydrocarbon measurement through improved metering and cargo regulations, digitalising upstream regulatory activities to ensure compliance, optimising unit costs per barrel to maximise revenue, and conducting licensing bid rounds to revitalise non-performing assets in line with the Petroleum Industry Act 2021.
Komolafe disclosed that the Commission had developed a structured template to identify the specific needs of all participants within the value chain.
“This template aims to address gaps by leveraging the capabilities of different players, thereby fostering collaboration, networking, and operational optimisation,” he stated.
To ensure a consistent supply of crude oil to domestic refiners, Komolafe revealed that the Commission had introduced significant regulatory measures earlier this month to enforce compliance with the Domestic Crude Supply Obligation (DCSO). These measures include the signing of the Production Curtailment and Domestic Crude Oil Supply Obligation Regulation 2023 and the implementation of a DCSO framework and procedure guide.
Komolafe stressed that the Commission would strictly enforce policies regarding compliance and defaults by oil companies, warning that companies failing to meet their obligations could face penalties, including the denial of export permits for crude oil intended for domestic refining.
However, he clarified that this was not a threat to legitimate industry players but rather a measure against non-compliant operators seeking to circumvent legal requirements.
Reiterating the government’s stance, Komolafe affirmed that while investor interests would be protected, energy security and national interests would not be compromised. He underscored that the government would not interfere with product pricing as long as prices remained fair and reasonable.
He reaffirmed the government’s commitment to the willing-seller, willing-buyer model, which aligns with international best practices. He assured stakeholders that the government would continue to support the upstream sector’s optimal functioning without resorting to price-fixing.
