The Nigerian National Petroleum Corporation, NNPC, may have extended its contracts with private oil firms to swap crude oil for petrol by 6-months.
According to Reuters, the affected oil companies renegotiated the price agreement due to changes that were made in the prices of petrol in the country.
The initial one year oil swap contract to exchange over 300,000 barrels of crude oil per day with some companies is due to expire in October 2020.
The swap deal with these companies supplies a huge portion of Nigeria’s petroleum products which include fuel, diesel and jet fuel, as it has not been profitable for private oil companies to import fuel into the country. It would be recalled that NNPC had a year ago contracted about 34 companies under a total of 15 groupings to carry out a swap deal for the supply of refined fuel in exchange of crude oil.
This scheme was introduced in 2016 to replace the programme at that time which gulped trillions of naira in subsidy payments to importers and supplied about 90 percent of the fuel import requirements.