For decades, Nigeria has occupied a paradoxical place in the global energy system. Despite being Africa’s largest oil producer and possessing enormous hydrocarbon wealth, the country remains vulnerable to fuel shortages, rising petrol prices, and external market shocks. The closure of the Strait of Hormuz in early 2026 exposed these long-standing weaknesses with alarming clarity.

The Strait of Hormuz is one of the world’s most strategic waterways, carrying nearly 20% of global oil trade through a narrow corridor linking the Persian Gulf to international markets. When geopolitical tensions disrupted shipping routes in March 2026, Brent crude prices surged above $114 per barrel, the highest level since 2022. The shock triggered global concern, especially for economies heavily dependent on imported fuel and petrochemical products.

For Nigeria, however, the crisis was more than an international energy disruption. It revealed deep structural failures within the country’s own energy system.

The contradiction at the center of Nigeria’s economy is striking. Although the country produces millions of barrels of crude oil, it has spent decades importing refined petroleum products because of inadequate domestic refining capacity. Fuel scarcity, long queues at filling stations, and unstable pump prices have become routine realities for ordinary Nigerians.

The launch of the Dangote Refinery in 2024 initially raised hopes that this cycle would finally end. With an initial refining capacity of 650,000 barrels per day and plans for future expansion, the refinery was celebrated as a landmark industrial achievement capable of transforming Nigeria’s energy sector. Many viewed it as a symbol of economic independence and industrial ambition.

Yet the refinery quickly encountered the same structural problems that have long undermined Nigeria’s energy industry.

International oil companies operating in Nigeria continued prioritizing exports to global markets rather than supplying domestic refineries. As a result, local refiners struggled to secure stable crude supplies despite operating in one of the world’s leading oil-producing nations. In a deeply ironic situation, the Dangote Refinery was forced to import crude oil from the United States and other........

© Blitz