Oil crisis squeezes downstream operators despite emerging opportunities — MEMAN

The Major Energies Marketers Association of Nigeria (MEMAN) has warned that Nigeria’s downstream petroleum operators are facing mounting pressure from the ongoing global oil crisis, even as market conditions present new opportunities.

Speaking during a webinar hosted in collaboration with S&P Global, MEMAN Chairman, Huub Stokman, described the situation as a “double-edged reality” driven by geopolitical tensions in the Middle East.

“While it creates opportunities for producers, it exerts immense pressure on downstream operators and, ultimately, consumers,” Stokman said.

He noted that rising volatility, increased shipping and insurance costs, and shifting crude sourcing patterns are straining operators, while also tightening margins across the supply chain.

Stokman said Nigeria could position itself as a reliable global energy partner if it addresses persistent challenges such as pipeline insecurity, regulatory uncertainty, and infrastructure deficits. He pointed to domestic refining capacity, particularly the Dangote Refinery, as a potential buffer against external shocks, though he cautioned against risks linked to supply concentration.

According to MEMAN, Nigeria currently maintains over 30 days of petrol supply, with NNPC Limited acting as supplier of last resort. However, domestic fuel prices remain influenced by global trends, with delays in price adjustments tied to inventory cycles and financing constraints.

Global analysts at the session warned that refined product markets are tightening due to supply disruptions and costly vessel rerouting, particularly around the Cape of Good Hope, which is driving up freight costs and squeezing already fragile markets.

Industry players say the impact is already being felt locally, with rising petrol prices reducing demand.

Marketers report that customers who previously purchased up to 20,000 litres now buy significantly less, reflecting declining consumption amid high costs.

Stakeholders noted that while short-term volatility is likely to persist, sustained reforms and investment across the value chain will be critical to strengthening Nigeria’s long-term energy security.