By: Goodluck E.Adubazi, Abuja.

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has released its first-quarter 2026 report on the enforcement of the Domestic Crude Supply Obligation (DCSO), revealing a significant gap between crude oil volumes allocated, offered, and ultimately delivered to local refineries.

According to the report, a total of 61.9 million barrels of crude oil was allocated to domestic refineries between January and March. However, producers exceeded expectations by offering 68.7 million barrels within the same period.

Despite this surplus, actual supply lagged considerably at just 28.5 million barrels — translating to a conversion rate of roughly 36 to 46 percent.

A month-by-month breakdown highlights persistent inefficiencies in the system. In January, following consultations with industry stakeholders, the Commission mandated the supply of 22.6 million barrels. Producers responded positively, offering 25.3 million barrels — nearly 12 percent above target — yet only 9.2 million barrels reached local refiners.
February saw a slight decline in performance. While the Commission allocated 20.5 million barrels, producers offered 19.8 million barrels, falling short by 700,000 barrels.

Actual deliveries remained low at 9.1 million barrels.
In March, supply figures showed marginal improvement, with deliveries rising to 10.1 million barrels. This came against an allocation of 18.8 million barrels and an offer of 23.6 million barrels — exceeding targets by 25.5 percent. Nevertheless, the gap between supply commitments and actual deliveries persisted.

The Commission attributed the recurring shortfall primarily to pricing disagreements between crude oil producers and domestic refiners. It noted that transactions under the DCSO framework operate on a “willing buyer, willing seller” basis, which continues to influence market outcomes.

Despite the challenges, the NUPRC reaffirmed its commitment to achieving national energy security goals. It emphasized that, under the provisions of the Petroleum Industry Act (PIA) 2021, efforts are ongoing to improve transparency, efficiency, and compliance within the DCSO framework.

The Commission stated that it would continue refining its methodologies to ensure domestic refineries receive adequate crude supply, while sustaining recent gains in national oil production.