India Purchases Nigerian Crude While Dangote Imports US Oil

India has resumed large-scale purchases of Nigerian crude oil, even as the Dangote Petroleum Refinery in Lagos has begun importing significant volumes of crude from the United States to feed its operations. The development underscores shifting dynamics in Nigeria’s oil trade, shaped by global market trends, refining capacity challenges, and strategic sourcing decisions.

According to industry sources, Indian refiners recently booked several cargoes of Nigeria’s flagship crude grades, including Bonny Light and Qua Iboe, for delivery in the coming months. India, one of the world’s largest oil importers, has traditionally been a strong customer for Nigerian crude due to its suitability for the country’s refineries. However, competition from other producers and shifts in global trade flows had seen Nigerian sales to India fluctuate in recent years.

The renewed interest from India comes at a time when Nigeria is working to strengthen crude exports amid production and security challenges in the Niger Delta. Market analysts suggest that improved supply reliability and competitive pricing have helped Nigerian grades regain traction in Asia’s second-largest economy.

At the same time, the Dangote Refinery, Africa’s largest single-train refining facility, has begun sourcing crude oil from the US, particularly West Texas Intermediate (WTI) and other light sweet grades. While the refinery is expected to process significant volumes of Nigerian crude in the long term, the decision to import US crude is said to be linked to operational considerations, including blend optimization and supply chain testing during its ramp-up phase.

Industry experts note that light sweet crudes like WTI are easier to process and yield higher-value petroleum products such as gasoline and diesel. With the refinery in its early operational stages, ensuring steady feedstock quality is a priority, and imports from the US provide a consistent supply option while local arrangements are finalised.

The twin developments highlight the complexity of Nigeria’s oil market, where exports to traditional buyers like India must coexist with domestic refining needs. The Nigerian National Petroleum Company Limited (NNPCL) has reiterated its commitment to supplying local refiners, including Dangote, but has acknowledged that crude allocation policies must balance both domestic processing capacity and foreign exchange-generating exports.

The arrival of US crude cargoes at the Dangote facility has sparked discussions about the country’s refining future. Some stakeholders argue that importing crude defeats the purpose of local refining if Nigeria’s own output is not fully utilised. Others counter that in the global oil market, refineries regularly source from multiple locations to optimise yields and profitability.

For India, the renewed Nigerian supply offers diversification away from Middle Eastern and Russian barrels, which have dominated its import basket in recent years. Nigerian crude’s high-quality, low-sulphur characteristics make it well-suited for producing cleaner fuels that comply with the country’s environmental regulations.

Meanwhile, Nigeria faces the task of boosting production to meet both domestic and export demand. Output has been recovering gradually after years of underinvestment, oil theft, and operational disruptions. Industry insiders believe that stabilising production above 1.6 million barrels per day would be critical to sustaining exports to key markets like India while ensuring enough feedstock for the Dangote and other refineries.

The simultaneous increase in Indian imports and US crude deliveries to the Dangote Refinery underscores the interconnected nature of global oil markets. For Nigeria, this could mean greater revenue opportunities if production remains stable, but it also requires careful coordination between upstream output, domestic refining, and export obligations.

In the coming months, market watchers will be looking to see whether India maintains its renewed appetite for Nigerian crude and how quickly Dangote transitions to processing primarily domestic grades. The interplay between export sales and domestic refining supply will likely remain a central theme in Nigeria’s oil sector strategy, especially as the government seeks to maximise foreign earnings while reducing dependence on imported petroleum products.

 

Ultimately, the dual-track oil trade reflects both opportunity and challenge for Africa’s largest oil producer. With India’s re-engagement and the Dangote Refinery’s operational momentum, Nigeria has a unique window to leverage its resources for both export strength and energy self-sufficiency — but only if production stability, supply reliability, and policy clarity are sustained.