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Nigeria’s economic pulse: Naira-for-crude talks, renewable energy deals & anti-corruption wins

Explore Nigeria’s efforts to renew its naira-for-crude deal, a $200M renewable energy project, and record-breaking anti-corruption recoveries shaping the nation’s economy.

Author

Samuel Okocha
March 13, 2025

Welcome to this week’s 234Digest: Thursday Edition—a roundup of essential updates on Nigeria’s economy, energy, and governance. Published twice weekly on Wednesdays (with a slight delay this week) and Sundays, I aim to bring you the stories shaping Nigeria.

In today’s edition, we explore Nigeria’s negotiations to extend its naira-for-crude deal with the Dangote Refinery, the naira’s recent volatility amid softer oil prices, and a $200 million renewable energy deal aimed at electrifying rural communities. We also highlight Nigeria’s record-breaking anti-corruption recoveries, efforts to regulate its cryptocurrency market, and progress toward appointing ambassadors after an 18-month hiatus. Finally, our Photo of the Day captures the resilience of Nigeria’s informal economy on Abuja’s outskirts, where roadside fuel sellers bridge gaps in the formal fuel distribution system.

It’s just past 6:30 am as I send this newsletter. Let’s dive in.

— Samuel Okocha, Editor & Curator, 234Digest

Word for word

“The policy framework enabling the sale of crude oil in for domestic refining remains in force. The initiative was designed to ensure supply stability and optimise the utilization of local refining capacity.”

— Zacch Adedeji, Chairman of the Naira-for-Crude Technical Sub-Committee

Today’s briefs

Nigeria in talks to extend naira-for-crude deal with Dangote Refinery

Nigeria is negotiating with the Dangote Refinery to extend its naira-for-crude agreement, which is set to expire at the end of March. The deal allows Africa’s largest refinery to purchase crude oil in naira instead of dollars—a strategy aimed at reducing foreign exchange pressure and stabilizing domestic fuel prices.

Since October 2024, the Nigerian National Petroleum Company (NNPC) has supplied 48 million barrels of crude under this arrangement. In total, over 84 million barrels have been delivered since the refinery began operations in 2023. Talks are ongoing to finalize a new contract as both parties aim to sustain this mutually beneficial agreement.

Naira volatility returns amid softer oil prices

The naira weakened by nearly 4% last week, trading at ₦1,552 per dollar before recovering slightly to ₦1,538 on Monday. Analysts attribute this volatility to softer oil prices—down 15% from their January peak—and lower local money market rates. Crude oil sales account for most of Nigeria’s foreign currency earnings.

The Central Bank of Nigeria is expected to intervene by supplying dollars in the market and maintaining attractive yields to stabilize the currency amid these challenges.

Nigeria signs $200 million renewable energy deal

Nigeria has signed a $200 million deal with WeLight, a pan-African Distributed Renewable Energy (DRE) company, to deploy 400 mini-grids and 50 MetroGrids across rural areas and urban outskirts. The project aims to provide reliable electricity access to an estimated 1.5–2 million people, boosting local economies while increasing renewable energy's share in Nigeria's electricity mix from 22% to 50%.

Backed by the World Bank and African Development Bank (AfDB), this initiative supports Nigeria’s broader goal of achieving universal electricity access by 2030.

EFCC recovers $500 million in proceeds of crime

Nigeria’s Economic and Financial Crimes Commission (EFCC) announced it recovered nearly $500 million in stolen funds last year—the highest in its two-decade history. The agency also secured over 4,000 criminal convictions, with recovered assets including real estate properties, petroleum products, and company shares.

While these achievements mark progress in combating corruption, Nigeria remains ranked 140 out of 180 on Transparency International's Corruption Perception Index.

Nigeria move toward regulating cryptocurrency market

Nigeria is taking steps to regulate its cryptocurrency market—the largest in Africa—after years of skepticism from regulators. The Securities and Exchange Commission (SEC) has granted "Approval-in-Principle" licenses to two exchanges: Busha Digital Limited and Quidax Technologies Limited.

These efforts aim to create legal certainty while addressing concerns about fraud and volatility in a country that ranked second globally for crypto adoption in 2023 and 2024.

Nigeria prepares to appoint ambassadors after 18-month gap

The Nigerian government has begun vetting candidates for more than 100 diplomatic missions, with appointments expected soon after an 18-month hiatus. Since recalling all ambassadors in September 2023 due to funding constraints, Nigeria has operated without formal diplomatic representation abroad—a situation that has drawn criticism from foreign leaders.

The Ministry of Foreign Affairs confirmed that security agencies are conducting background checks on potential appointees, Reuters reported, as President Bola Tinubu prioritizes fixing Nigeria's economy before turning his focus to foreign policy.

Catch up: Why the naira-for-crude deal matters

Nigeria’s naira-for-crude agreement with the Dangote Refinery represents a bold strategy for addressing multiple economic challenges. By allowing Africa’s largest refinery to purchase crude oil in naira rather than dollars, the deal reduces pressure on foreign exchange reserves while ensuring a steady supply of refined petroleum products domestically.

Key achievements so far

  • Since October 2024, NNPC has supplied over 48 million barrels of crude under this deal.

  • In total, more than 84 million barrels have been delivered since operations began in 2023.

  • The arrangement has helped stabilize gasoline prices and reduce inflationary pressures.

Why it matters

  • Economic Stability: By reducing reliance on dollar transactions, the deal eases pressure on Nigeria's foreign exchange reserves.

  • Energy Security: Ensures consistent supply of refined products like gasoline and diesel for domestic consumption.

  • Cost Savings: Reduces import dependency while supporting local refining capacity at Dangote Refinery—a facility capable of processing up to 650,000 barrels per day.

As discussions continue toward renewing this agreement beyond March 2025, stakeholders emphasize its importance in sustaining Nigeria’s energy security and economic stability.

Photo of the day

Fueling Life on Abuja’s Outskirts: On the outskirts of Abuja, a roadside fuel seller measures petrol into a 1-litre keg for a waiting commercial motorcyclist at midnight. Larger kegs, neatly arranged on a table, form the backbone of this informal business. This scene highlights the role of Nigeria’s black market in bridging fuel shortages and inefficiencies in the formal distribution system, especially in areas where official supplies are limited, highlighting the resilience and adaptability that define life on Abuja’s outskirts. Photo by Samuel Okocha/234Digest

Data snapshot

  • Naira-for-crude upply: Over 84 million barrels delivered since 2023; talks underway for renewal.

  • Renewable energy expansion: $200 million deal; targets electricity access for 1.5–2 million people.

  • EFCC recoveries: $500 million; highest ever recorded by the agency.

  • Crypto adoption rank: Second globally in 2023–2024; regulatory framework taking shape.

  • Ambassadorial appointments: Overdue since September 2023; progress underway.

And that’s a wrap. Until Sunday when the next dispatch arrives, stay strong as we keep tabs on Nigeria’s evolving story.