- Crude is sold by producers (each markets its own share) and by NNPC Ltd (which sells the Federation's share).
- NNPC sells FOB, at a published monthly official selling price linked to Dated Brent, to buyers selected through advertised tenders.
- Standard cargoes are about 950,000 barrels; payment is by letter of credit.
- An "allocation" is a cargo scheduled for an existing contract holder. It is not a certificate that can be bought, sold or "activated".
Who can lawfully sell Nigerian crude
1. Producers marketing their own entitlement
Holders of petroleum leases own and may export their share of production. The regulations state the principle directly: a lessee is entitled to export crude in excess of any domestic supply obligation imposed on it, and an "exporter" is a licensee or lessee, or a person otherwise entitled by law to export.12 Law / regulation
In practice this means the international majors (Chevron, ExxonMobil, Shell, TotalEnergies, Eni), the Nigerian independents that have acquired onshore assets since 2024 (Renaissance, Seplat, Oando and others) and smaller producers each sell their own barrels, usually through an in-house trading arm or to an established trading house. The cargoes we document on our market pages — TotalEnergies and Shell selling to Indian Oil, for example — are sales of this kind.3
2. NNPC Ltd, selling the Federation's share
NNPC Limited is a company incorporated under the Petroleum Industry Act and wholly owned by the government. The Act makes it the concessionaire of production-sharing contracts on the Federation's behalf and requires it to lift and sell royalty oil and tax oil for the regulator and the tax authority.4 Law / regulation Nigeria's extractive-industries transparency body records NNPC-sold volumes of about 196 million barrels in 2023.5
3. Traders who have bought from 1 or 2
A trading company that holds an NNPC term contract, or that has bought a cargo FOB from a producer, owns that cargo and can resell it. Glencore's 2026 sale of Utapate and Okwuibome cargoes to an Indian refiner is an example.6 A genuine reseller can name the cargo, the loading window, the vessel and its own supplier.
How NNPC selects its buyers
NNPC's invitation-to-tender template for term contracts is a public document. The version we have read dates from the 2021–2023 cycle; we have not located the documents for later cycles, so thresholds may have changed.7 Commercial procedure It provides that:
- sales are FOB under a signed sale and purchase agreement, for a term of one year;
- only four categories may apply — a bona fide end user owning a refinery or retail network; a government-to-government buyer; an established, globally recognised large-volume crude trader; or an indigenous Nigerian downstream company;
- applicants must show a minimum annual turnover of US$500 million and net worth of at least US$250 million, three years of audited accounts, and the ability to open an irrevocable letter of credit;
- directors and beneficial owners must be disclosed, with sworn statements on insolvency, conflicts of interest and fraud convictions;
- a memorandum of understanding, or a letter of affiliation or introduction from another company, is not entertained; and
- NNPC deals only with authorised officers of the bidding company, not through individuals or agents.
Lists of successful term-contract holders have been published in past cycles — for example the 21 companies awarded 2015–16 contracts, including refiners at 60,000 barrels per day and traders at 32,000.8 Independent analysis of the system is available in the Natural Resource Governance Institute's study.9 NNPC also sells individual cargoes by short-notice tender: in August 2026 it offered Cawthorne and Bonny Light cargoes for late-September loading with a next-day bid deadline.10
What "allocation" actually means
In NNPC's documents the word has an ordinary meaning: a cargo allocated to an existing term buyer within a monthly lifting programme. The contract refers to opening a letter of credit for "allocated" crude and to suspending further allocation of cargoes to a buyer in default.711 Nothing in the tender or contract contemplates an allocation as a transferable paper right, and nothing provides for its resale by a third party. The glossary of broker-market jargon explains the related terms — ATS, TTO, ICPO — that appear in such offers.
Offers built on an "NNPC allocation" held by an individual, a "mandate" or a "facilitator" contradict three published NNPC positions at once: introductions are not entertained, agents are not dealt with, and buyers must meet nine-figure financial thresholds. In 2014 NNPC publicly disowned a circulating "letter of authorisation" naming a supposed off-taker.12 See the verification centre.
The commercial terms of a real sale
NNPC's general terms and conditions (2021–2023 edition) show what a genuine Nigerian crude contract looks like.11 Commercial procedure Producers' own terms differ in detail but follow the same international pattern.
- Delivery
- FOB the named Nigerian terminal. The buyer nominates and charters the vessel. See FOB and CIF explained.
- Price
- The average of published Dated Brent quotations over a pricing window, plus or minus NNPC's monthly official selling price differential for the grade. The same formula applies to buyers generally — there is no private "discount". See pricing.
- Payment
- Irrevocable documentary letter of credit under UCP 600, lodged at least six banking days before the loading window; payment 30 days after the bill of lading date.
- Quantity
- Bill of lading quantity is final. Standard cargoes are about 950,000 barrels; cargo sizes by stream are in the grade database and loading points in the export terminal database.13
- Documents
- Bill of lading, certificates of quantity, quality and origin, cargo manifest, time sheet, ullage report and master's receipt for samples.
- Destination
- Restricted-destination clauses apply, and the seller can demand proof of discharge.
What happens at export
Every cargo must now pass a regulatory sequence that leaves a verifiable trace Law / regulation:
Export permit
The producer or exporter holds an export permit, processed and endorsed by the upstream regulator and sized to its production entitlement net of any domestic supply obligation.114
Advance cargo declaration
At least five days before the vessel arrives, the exporter declares the consignee, vessel IMO number, quantity and destination to the regulator.2
Vessel clearance and Unique Identification Number
The regulator validates the declaration and issues a clearance carrying a UIN. Exporting without one carries a fine of up to US$1 million.2
Loading and certification
After loading, the regulator issues the certificate of quantity and quality. The UIN must appear on it, on the bill of lading, the certificate of origin and the cargo manifest.14
The full framework, including the domestic supply obligation that can restrict exports, is in our compliance guide.
Where Nigeria Crude Oil Merchant fits
We do not claim to be NNPC, a crude producer or the holder of an NNPC term contract, and we do not publish cargo availability or "allocations". Our role is to qualify genuine international buyers and to work with our Nigerian partner to identify supply from lawful sellers of the kinds described above. Any transaction that results is concluded between principals, under formal contracts, with payment through the banking system against shipping documents. We publish this guide so that a buyer can hold us to the same standard as anyone else. More on who we are is on the about page; what to prepare before approaching any seller is in the international buyer centre.