Nigerian National Petroleum Corporation, NNPC has extended its contracts with private companies to swap crude oil for fuels for extra six months.
The initial one-year contracts to exchange more than 300,000 barrels per day (bpd) with 15 company pairings were due to expire in October, the Corporation said on Wednesday, adding that the companies renegotiated the price agreement due to changes to fuel prices in Nigeria.
The contractors supply a large portion of Nigeria’s gasoline, and some of its diesel and jet fuel, as it has not been profitable for private importers to bring in fuel.
Nigeria recently stopped setting a gasoline price cap at the pump, a decision that will eliminate costly subsidies and enable the private sector to begin importation again.
Subsidiary PPMC still sets an ex depot price for fuels imported by NNPC. This, combined with dollar shortages, has thus far made it difficult for some importers to bring in fuels outside the contracts.
Compliance with oil production cuts in August among OPEC+ members were seen at around 101%, two OPEC+ sources told foreign media on Wednesday.
A technical committee of the alliance of the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, held a meeting on Wednesday to discuss market fundamentals and compliance.