The Nigerian Downstream Oil & Gas Industry (‘the Industry’) plays a vital role in the national economy, encompassing the refining, storage, distribution, marketing and retailing of key petroleum products such as Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), Aviation Turbine Kerosene (ATK), Dual-Purpose Kerosene (DPK) and Liquefied Petroleum Gas (LPG). The year 2025 marked a pivotal juncture for the Industry, as the full deregulation of PMS pricing improved product availability and intensified market competition. A defining development was the progressive ramp-up of the Dangote Petroleum Refinery, which reached its full nameplate capacity of 650,000 barrels per day in February 2026. Domestic refineries supplied approximately 37.5% of national PMS consumption in 2025, with a decisive structural shift occurring in January 2026 when domestic production surpassed imports for the first time. This positions Nigeria to displace petroleum product imports and emerge as a refining hub of regional significance, even as BUA Group’s 200,000 bpd refinery in Akwa Ibom remained under construction.
In the financial year ended 31 December 2025, selected industry operators recorded aggregate turnover of approximately ₦2.5 trillion, broadly flat year-on-year. Profitability came under pressure, with the operating profit margin compressing to 0.1% (2024: 3.3%) and profit after tax declining to ₦9.3 billion (2024: ₦52.2 billion), driven by elevated landed costs, persistent Naira depreciation and higher procurement costs under the deregulated regime. Liquidity nonetheless remained adequate and balance sheet leverage improved modestly. Looking ahead, the shift to domestically refined products is expected to ease FX-linked cost pressures and support a recovery in operating margins to 3.5%–4.5% over the medium term.
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