NUPRC allocates 61.9 million barrels of crude to local refineries in Q1 2026

Key Points

• The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) allocated 61.9 million barrels of crude to domestic refineries in the first quarter of 2026.
• Producers offered 68.7 million barrels during the same period, exceeding the mandatory allocation requirements.
• Actual deliveries to local refineries reached 28.5 million barrels, resulting in a supply conversion rate of 36 to 46 percent.
• Shortfalls between offered volumes and actual supplies are primarily attributed to pricing gaps under the “willing buyer, willing seller” framework.
• The Commission is refining its Domestic Crude Supply Obligation (DCSO) methodology to enhance transparency and ensure local supply commitments are met.

Main Story

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has released new statistics regarding the Domestic Crude Supply Obligation (DCSO) for the first quarter of 2026.

Under the provisions of the Petroleum Industry Act (PIA 2021), the Commission allocated 61.9 million barrels to domestic refineries to bolster national energy sufficiency. While producers demonstrated a high level of cooperation by offering 68.7 million barrels—exceeding the allocated amount—actual supply remained significantly lower at 28.5 million barrels.

This discrepancy highlights ongoing challenges in the domestic market, specifically regarding a supply conversion rate that fluctuated between 36 and 46 percent.

The NUPRC noted that while producers often met or exceeded offer targets, the final deliveries were frequently stalled by pricing disagreements between producers and refiners.

Moving forward, the Commission remains committed to leveraging the PIA 2021 framework to sustain production gains and improve the efficiency of local crude distribution.

The Issues

• The primary reason for the shortfall between volumes offered and actual deliveries is the pricing disagreement between producers and domestic refiners.
• Transactions operate on a “willing buyer, willing seller” basis, which allows market forces to dictate whether an offer leads to a final sale.
• The low conversion rate (36-46%) suggests that nearly half of the crude offered to local refineries is not being successfully transacted.

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• In February, producers missed the mandated allocation target by 700,000 barrels.

What’s Being Said

• Producers “exceeded expectations” in January by offering 11.9 percent more than the mandated volume.
• There was a “modest improvement in deliveries” in March, rising to 10.1 million barrels from previous monthly lows.
• The NUPRC “reaffirms its commitment to achieving the government’s objective of energy sufficiency” through the PIA framework.
• The Commission aims to “continuously refining the DCSO methodology to enhance transparency” and efficiency.

What’s Next

• The NUPRC will continue to “refine the DCSO methodology” to address the transparency and efficiency of crude distribution.
• Stakeholders will monitor whether “pricing gaps” can be bridged to improve the supply conversion rate in the second quarter.
• Efforts to “sustain recent gains in crude oil production” will remain a priority for the Commission.
• Domestic refineries are expected to continue engaging with producers to secure the “committed” supplies mandated under the PIA.

Bottom Line

While the NUPRC successfully allocated over 60 million barrels to domestic refineries in Q1 2026, pricing disputes under the “willing buyer, willing seller” model meant that less than half of that volume was actually delivered.