The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is consulting oil producers and domestic refiners on a crude swap framework that could reduce transportation costs by up to $4 per barrel for local refineries.
The commission’s Chief Executive, Oritsemeyiwa Eyesan, disclosed this on Monday at the OTL Africa Downstream Energy Week 2026 in Lagos, saying the proposed arrangement would allow refiners to obtain crude from nearby production or export points rather than transport allocated grades over long distances.
“Under it, a refiner could receive crude from the nearest suitable production or export point instead of moving an allocated grade over long distances, which could take an estimated three to four dollars off the cost of every barrel,” she said.
Eyesan’s speech was delivered by the Assistant Director, Operations, Prosper Omonedo, while the commission’s Head of Media and Corporate Communications, Eniola Akinkuotu, announced the remarks in a statement.
The proposed framework is aimed at reducing logistics expenses for domestic refiners amid persistent disagreements over crude pricing, payment terms and supply arrangements.
Eyesan said the commission had intervened in disputes between producers and refiners to improve crude deliveries, with more than 127 million barrels of Nigerian crude oil and condensate supplied to domestic refineries between January and September 2026.
She said 53.7 million barrels were supplied in the second quarter, while 45.1 million barrels were delivered in the third quarter, following disruptions caused by commercial disagreements in the first quarter.
The deliveries form part of efforts to implement the Domestic Crude Supply Obligation under the Petroleum Industry Act 2021, which provides a framework for supplying crude to local refineries.
Despite the increase in deliveries, access to locally produced crude has remained a challenge for refiners, with commercial disputes affecting supply arrangements.
The proposed crude swap could help reduce the cost of moving crude and improve the economics of domestic refining. However, the extent of any savings will depend on the framework’s implementation and the participation of producers and refinery operators.
On production, Eyesan said Nigeria recorded an average of 1.717 million barrels per day of crude oil and condensate in September, a 2.34 per cent increase from August.
Crude oil production alone averaged 1.53 million barrels per day, marking the fifth consecutive month the industry met or exceeded its quota.
She attributed the improvement to better asset integrity, stronger security around evacuation infrastructure, collaboration with operators and efforts to restore shut-in production.
Eyesan said the commission remained committed to ensuring that increased upstream production translated into benefits for households, industries and power generation.
Nigeria has been expanding domestic refining capacity to reduce reliance on imported petroleum products. The proposed crude swap framework is intended to ease one of the sector’s key challenges by reducing the cost of transporting crude to local refineries.
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