How To Find Real Crude Oil Sellers And Buyers In Nigeria

How To Find Genuine Crude Oil Sellers In Nigeria
How To Find Genuine Crude Oil Sellers and Buyers In Nigeria

This article is a continuation of the first in its series titled: The Ultimate Guide To Starting A Crude Oil Brokerage Business (Crude Oil Selling) In Nigeria And Africa. It sheds light on the processes that go on in the crude oil business in Nigeria for international crude oil buyers looking for genuine crude oil sellers, and shows everything you need to look out for throughout the entire transaction.

Buying crude oil from Nigeria can be relatively straight forward if the crude oil buyer can buy crude oil from a reliable or genuine crude oil seller (mostly a company that has the ability to lift crude oil from the NNPC) or a crude oil broker (a company who brokers on behalf of a company with the ability to lift crude oil from the NNPC) from the OFF-OPEC market.

See Also: 45+ Off-OPEC Frequently Asked Questions & Answers By Crude Oil Buyers In Nigeria

There are procedures and checklists that must be followed to ensure that a genuine transaction takes place. Some of them are:

1). Proof of Product and Proof of Funds:

Before any transaction can occur between a genuine crude oil buyer and a genuine crude oil seller, both parties must show they are reliable from both ends. The crude oil buyer must show they have the proof of funds to purchase the volume of crude oil been sourced, and the crude oil seller or crude oil broker must prove ability to deliver crude oil to the crude oil buyer.

If the crude oil seller or crude oil broker cannot show an ability to supply through either a safe financial procedure or some other means to the crude oil buyer, the buyer can choose to walk away to another crude oil seller or broker immediately.

2). The Type Of Crude Oil Produced In Nigeria:

Nigeria produces different varieties of crude oil, with the most widely demanded being the Bonny Light Crude Oil (BLCO). This crude oil is the best in the world because of its relatively low cost to refine due to its low sulphur content. This is a major reason most crude oil buyers (refineries) around the world are interested in Nigeria’s crude oil.

Forcados is another type of crude oil in Nigeria that is considered a heavier grade. Lighter grade crude oil is preferred due to its easy refining state, making it easy to produce diesel from it and many other petrochemicals.

The different grades of the crude oils in Nigeria generally have slightly different prices.

See Also: How To Find Real AGO Sellers And Buyers In Nigeria


Four Things To Know About Buying And Selling Crude Oil In Nigeria

1). Availability of Funds:

To buy or sell crude oil from Nigeria, you’d need to have a lot of money, usually multi-millions of dollars. This is a reason several people find it difficult to venture into the crude oil brokerage business since they can’t find a crude oil seller or crude oil buyer that has the financial capacity to act.

Usually, when a crude oil buyer indicates interest, they’d have to show the seller that they have proof of funds.

If a transaction is to pull through eventually, the crude oil seller with an ability to supply would have to pay 100% for the crude oil cargo before the NNPC can sell to them on FOB basis, afterwhich they go on to resell the crude oil on CIF basis. But since most crude oil sellers don’t have this some crude oil brokers have the ability to raise the money, and so, source the crude oil on behalf of the crude oil seller with the ability to lift crude oil, receive the ICPO in their business name, and leverage the crude oil seller’s connections from the NNPC to purchase and ship the crude oil, while settling the original crude seller with the a commission.

In the event that the crude oil seller can afford to have the money for the transaction, the crude oil broker can negotiate a commission per barrel sold on every barrel that is successfully sold. It could be 50 cents per barrel, lesser, or more.

2). You’d Need A Crude Oil Seller:

As stated in the previous point, a crude oil buyer will have to find a genuine crude oil seller or crude oil broker in Nigeria to be able to transact successfully. To verify their authenticity, you’d need to ensure the crude oil seller or crude oil broker can use a very reasonable procedure, show proof of past performance, show ability to post a performance bond, while the crude oil buyer will provide a proof of funds.

3). You’d Need A Crude Oil Buyer:

Just as a crude oil buyer needs a crude oil seller, a crude oil seller also needs a crude oil buyer. The good thing is crude oil buyers are constantly looking out for genuine crude oil sellers, and when they do find one, they prefer to have a long-term contract that spans through several years.

You could also source crude oil buyers yourself by reaching out to them through their company contact details.

See Also: How To Buy Crude Oil From Nigeria: Complete Guide For Buyers And Sellers


The Different Ways To Get Crude Oil From Nigeria

1). Directly From The Nigerian National Petroleum Corporation (NNPC):

The Nigerian National Petroleum Corporation (NNPC) is Nigeria’s oil & gas regulatory body, and is the organization that has the direct right to sell crude oil. The problem with going through the NNPC is they have very strict conditions, and so, most crude oil buyers prefer to go through companies who have been awarded crude oil allocations by the NNPC.

Some of the conditions to secure an OPEC allocation are:

  • A proof of fund spanning through $100,000,000.
  • Will post an upfront SBLC before you even secure an allocation.
  • Must own a local refinery or international refinery.
  • And much more.

These conditions make refineries take the other route of using crude oil sellers.

2). OPEC Sellers:

These are oil and gas companies in Nigeria that have the ability to lift crude oil from the NNPC because of the allocation allotted to them. They are required to sell off their allocations within a certain period and can be approached by crude oil buyers if they cannot meet the conditions set by the NNPC to buy directly from the corporation.

3). Independent OFF-OPEC Sellers:

These are individuals or smaller businesses who have connections to the federal government to lift crude oil on Provisional Lifting Rights basis. They could make their purchase direct from the NNPC or the Production Sharing Contract holder.

4). A Loaded Vessel:

A crude oil buyer can buy from a crude oil seller who already has a vessel loaded with crude oil. This usually happens when the crude oil seller’s previous crude oil buyer defaults, leaving them with crude oil already paid for. But 99.5% of loaded crude oil offers are scams.

See Also: 14 Things That Kill Crude Oil Marketing Transactions In Nigeria


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The Different Ways To Sell Crude Oil From Nigeria

There are four different ways to sell crude oil from Nigeria. They include:

1). Cost Insurance and Freight (CIF):

Here, the crude oil seller will handle everything from loading the vessel and sending the crude oil to wherever the buyer wants it delivered. They buy from the NNPC on FOB terms and ship to the crude oil buyer on CIF terms.

2). Freight On Board (FOB):

Here, the crude oil seller pays for the loading and clearance costs of the cargo, while the crude oil buyer pays the cost of marine freight transport, insurance, unloading, and transportation from the arrival port to the final destination. In this case, the crude oil buyer pays for the cargo before it sails out of Nigerian waters.

3). Tanker Take Over (TTO):

Here, the crude oil buyer will take over the vessel, offload at their destination, and return it.

4). Tanker To Tanker (TTT):

Here, the crude oil buyer uses their own vessel, then the oil is transshipped when the transaction is fully settled.

See Also: The Crude Oil Marketing Business In Nigeria: Complete Guide For Buyers & Sellers


How Payment Is Made for Crude Oil Transactions In Nigeria

Payments are made through various means like wire transfers, bank to bank transfer, or any other agreed means of payment.


The Price Of Crude Oil In Nigeria

The price of crude oil in Nigeria per barrel is usually what is listed on the OPEC’s website.


How To Find Genuine Crude Oil Sellers In Nigeria

1). Genuine OPEC crude oil sellers in Nigeria are given allocations from the NNPC, which is the body that regulates the Nigerian petroleum industry. The first step to verify the authenticity of a crude oil seller then, is to ask to get their allocation details for verification. A failure to produce this can mean the crude oil seller is not a real OPEC seller. Besides, all OPEC crude oil sellers in Nigeria have their names published on the news yearly.

OFF-OPEC crude oil sellers on the other hand are not registered but have the ability to lift crude on PLR basis. After the crude oil buyer has placed a financial instrument, any genuine OFF-OPEC seller would get a verifiable Laycan that shows they have a lifting schedule in place. Some of these crude oil sellers would be willing to post an upfront performance bond to give the crude oil buyer comfort.

2). Be wary of crude oil sellers asking for upfront payments. Many, if not all of them, are fraudulent and will make you lose your money faster than you’d realize.

3). Ensure you speak with the crude oil seller over the phone to ask a series of questions. Replying emails is not enough. If possible, it is best for the crude oil buyers to get to eventually meet the crude oil seller in person. This is a whole lot safer than just remote conversations.

4). Upon clearing the cargo, the seller should be able to provide the full verifiable cargo documents. If the documents sent are not verifiable, then you know there’s a problem already.

See Also: How To Start A Commodity Brokerage Business From Anywhere Around The World


How To Find Crude Oil Sellers Through Intermediary Facilitators Or Brokers In Nigeria

To enable a crude oil transaction to go through easier and safely, a crude oil buyer may need to work with a facilitator. This is an individual that understands how to facilitate a deal and go through the sales process at the NNPC.

Getting genuine crude oil sellers directly can be extremely difficult for a crude oil buyer, but going through a facilitator or crude oil broker can help you execute a transaction faster and easier.


Some Terms Used In The Crude Oil Business In Nigeria

1). Proof of Product (POP):

This is a document presented by a seller to show proof that they have the product for sale. It can be sent via email or done physically and will go a long way in helping a crude oil buyer vet the authenticity of an available crude oil cargo.

Asides this, if the crude oil seller claims to be an OPEC seller, you have to ensure the crude oil seller has a genuine letter of allocation from the NNPC. A crude oil seller who presents their’s will then enable you to easily verify their authenticity or not from the NNPC’s crude oil marketing department.

If they’re OFF-OPEC sellers, then you’d need to ensure the trade process is extremely secure for all the parties involved.

2). Proof Of Fund (POF):

This document shows the crude oil seller that the crude oil buyer truly has the funds to acquire the crude oil required. This financial document will be issued by the crude oil buyer’s bank to prove the buyer isn’t a time waster or a fraud.

Some POF’s you can obtain that are acceptable are:

  • Bank Comfort Letter / RWA Letter
  • Bank Pre-Advice Confirming Readiness To Place A Financial Instrument
  • Bank Guarantee (BG)
  • Letter of Credit (L/C, or, LOC)
  • MT 799
  • MT 103

3). Sales And Purchase Agreement (SPA):

This a document that binds the crude oil buyer and crude oil seller to a contract, and stipulates stiff penalties for any party that attempts to scam or waste anyone’s time. Before an SPA is signed, both parties have to carefully come to an agreement, else one could be defrauded by the other even within a legal context of a contract, forcing one party to pay huge sums of money running into hundreds of thousands of dollars without a transaction taking place.

4). Letter Of Intent (LOI):

This a legal document that is issued by the crude oil buyer to show their intent, specification, and conditions to transact a crude oil deal.

5). Facilitator (Crude Oil Broker):

A facilitator is a middle man or broker who goes in search of both genuine crude oil buyers and crude oil sellers. By standing in as a link between two credible sources, the facilitator will ensure every document goes through them to the other party.

If the facilitator or crude oil broker successfully seals the contract and earns around 50 cents per barrel for say 2 million barrels, they could earn up to $1 million Dollars, depending on how many facilitators are in the transaction chain.

6). Mandate:

A mandate is the representative of either the crude oil seller or the crude oil buyer. They have the authority to act on behalf of the seller or buyer and may earn up to $1 per barrel in the transaction.


Some Problems That Arise In The Crude Oil Business In Nigeria

1). The Integrity Of Crude Oil Buyers And Crude Oil Sellers:

This is the biggest problem because it is always difficult for genuine crude oil sellers to meet genuine crude oil buyers and vice versa. When this is a problem, it is best to go with a reputable facilitator or crude oil broker’s advice.

2). Cutting Corners Around Due Process:

Some problems could arise if the crude oil buyer demands to see a Proof of Product, and allocation documents first, but the crude oil seller instead wants the buyer to show the Proof of Funds and to also sign a Sales and Purchase Agreement (SPA) first.

Many scenarios could cause this situation to happen, ultimately, any buyer should take extra caution when a seller insists on signing an SPA first.

It’s important to know that allocation documents are only valid for OPEC transactions. For OFF-OPEC transactions, the crude oil buyer has to ensure the trade process is extremely secure for all the parties involved.

3). No Bribery:

There is no need for any form of bribery to occur, as every contract term for every party is always well documented in the contract, and everyone gets paid their legitimate fee after the transaction is completed.

4). Problems With Finding Real Facilitators (Crude Oil Brokers):

Finding crude oil sellers is hard, and so, going with reputable crude oil brokers or facilitators makes the process a whole lot easier. But getting genuine facilitators is a large problem even for most crude oil buyers.

The large pool of fraudulent crude oil facilitators in Nigeria makes many crude oil buyers extremely wary, and so, makes even genuine crude oil brokers look bad or have a heavy suspicion placed on them by most crude oil buyers.

As a genuine crude oil facilitator, you’d have to do a great job of convincing the crude oil buyers you’re for real, and their hard earned money would not go to waste.

5). Several Facilitators In A Transaction:

When there are several crude oil facilitators involved in a transaction, the commission level continues to reduce per facilitator, and information passes through very slowly. Also, when crude oil buyers realize there are too many people in a transaction, they tend to pull away from it and go in search of another with a more direct link.

Too many people in a transaction make it difficult to pull through.

But then again, you could choose to stand in as a facilitator for a crude oil seller or a crude oil buyer. If you realize a crude oil buyer has a mandate, you can offer to stand in as a facilitator for them, and still stand in as a facilitator for the crude oil seller, enabling you to maximize your revenues.

6). Poor Knowledge Of The Product:

Most facilitators know nothing about the industry and product they’re trying to sell. They just want a commission and that’s it. As a facilitator, it’s important you completely understand the trade process, so that when the crude oil buyer puts a call across to you for a conversation, you can accurately sell yourself confidently and convince them you’re genuine and not a fraudster.

See Also: How To Start A Diesel Supply Business In Nigeria: The Complete Guide


To Sum It Up

The crude oil export business is one of the most lucrative aspects of the oil and gas industry in Nigeria. But despite its attractive profit potentials, many individuals find it difficult to successfully execute a transaction, due to the high level of fraud within the industry.

Crude oil buyers, on one hand, take extra care only to end up wasting so much time because they’re looking for genuine crude oil sellers. This challenge leads them to get facilitators or crude oil brokers, but still end up been sceptical, causing them to back out of several potential deals.


What are your thoughts on how to find real crude oil sellers and buyers in Nigeria? Let me know by leaving a comment below.


This article has been updated for better clarity of content.


An Important Point

Trying to buy crude oil from Nigeria through genuine sellers can lead to a lot of wasted time and efforts on the part of the crude oil buyers. They spend a lot of time vetting crude oil sellers in Nigeria, doubting their results even if positive, and going back and forth too many times than they can count, only to end up either cancelling their decision to buy or making a purchase after months or years have passed.

Since finding genuine crude oil sellers in Nigeria is a problem, it is always wise for a crude oil buyer to use a Nigerian organisation as its representative, so they can be on the ground and help the crude oil buyer make better calculative decisions.

To make this possible for crude oil buyers, Startup Tips Daily Media, through her sister company, Globexia, can help genuine crude oil buyers facilitate crude oil purchases from Nigeria.

Whatever position that helps crude oil buyers in Nigeria to close genuine crude oil transactions fast, transparently, and easier, we can make the process as stress-free as possible.

If you’re a genuine crude oil buyer, crude oil buyer mandate, crude oil seller, or crude oil seller mandate, you can reach out to us through the contact form below. If you’d like us instead to represent your interests as your crude oil seller mandate or crude oil buyer mandate, we’d be glad to do so.

We also offer a thorough in-depth due diligence service on exporters in Nigeria.

In addition to our crude oil facilitation business in Nigeria, we’re also AGO sellers in Nigeria (diesel suppliers in Lagos), and can supply AGO to tank farms, private or government organizations in Nigeria, or to countries like Cameroon, Ghana, and more, in the West African coast, while remaining willing to also represent your interests as your AGO buyer mandate or AGO seller mandate.

If you’re only a scam, don’t waste your time, as the conversation wouldn’t last too long after a few questions and demands to prove your authenticity have been made from our end.


Professional Due Diligence Checks In Nigeria By Globexia

International buyers are always wary of doing business with Nigerian based businesses because of the high risk of disappointments either in the form of time wasted or money lost, and as such, are highly sensitive of any organisation that presents them a trade offer.

To curb this problem and help international buyers make comfortable and confident trade decisions, Startup Tips Daily, through her sister company, Globexia, has set up an in-depth due diligence check consulting service that will help international buyers get in-depth information on any organisation looking to do business with them. Some of the information the international buyers stand to gain from the in-depth due diligence exercise that will be carried out by Globexia’s team of experienced lawyers in Nigeria are:

  • Verification of Company Registration
  • Verification of Export Licence
  • Verification of Export Activity
  • Verification of Past Certificates of Origin
  • Verification of Past & Present Bill of Ladings
  • Verification of International Passport / Driver’s Licence of The Exporter
  • Verification of Bank Verification Number (BVN)
  • Verification of Tax Documents
  • Verification of Financial Health of The Company
  • Verification of Mining Licence
  • Physical Verification of Office Address With Pictures & Videos
  • Physical Verification of Mining Site With Pictures & Videos
  • Full List of Registered Company Directors

And much more based on the client’s requirements.

You can read more about the service here.

If you simply want general commodity trade consulting in Nigeria spanning through Due diligence & proper verifications of both parties, understanding the entire Nigerian commodity trading industry, identifying and completing all due trade registrations, clearing & forwarding of the commodities, market research/feasibility study reports, and much more, Globexia Limited is the right partner to talk to.


We look forward to hearing from you.

You can reach us through the contact form below.

Thank you.

Contact Us

If you have any questions, inquiries, or need help or consulting regarding the import/export business, commodity trading, or any aspect of international trade as a whole, you may contact us by sending an email directly to [email protected] or Calling/WhatsApping 2348080888162.

Thank you.
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Startup Tips Daily Media

Lagos, Nigeria

Phone: 234 808 0888 162

Email: [email protected]



Stan Edom
Stan Edom
I'm an entrepreneur with expertise in supply chain management, international trade, small business development, e-commerce, internet startups, renewable energy, and agriculture. I'm also a network engineer, I.T security expert, and computer programmer. In my spare time when I'm not working out at the gym, I try to solve problems people face in their everyday lives with whatever means necessary.

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  1. I think I love the whole process and how simple you made it all look. thanks for this article.

  2. Well written article. I’ve had this problem of meeting so many fake facilitators in Abuja who will just be wasting your time. Do you have a genuine broker to a seller and can you link me with the person. I should be able to work out something real with him

  3. I am a Cameroonian representing a genuine Buyer of crude oil. Want t sign contract with a genuine crude oil seller for five years , to supply from 2 or more millions of barrels per month.

  4. I have a genuine seller. But to find direct buyer is my problem. Kindly link me wit genuine buyer. I have current ATS that can verify at bonny terminal. Am working direct wit NNPC mandate.
    Emmanuel Bassey

  5. Please i want you to connect me to genuine crude oil sellers in Nigeria and genuine buyers in the international market.

    • Hi Reginald,

      We facilitate crude oil transactions with genuine crude oil buyers and genuine crude oil sellers.

      If you have a genuine crude oil buyer, you can send us an email at [email protected] and we’d be glad to help facilitate the transaction.

      Thank you for asking.

  6. Nicely written. This is the process that many fake buyers dont even know. When you request for LOI & POF inorder to provide POP n other necessary procedures, they will just vanish.

  7. Jp54,D6,JA1,D2, Available FOB Rotterdam

    We are ready and willing to sell Jp54,D6,JA1,D2, Available FOB Rotterdam and CIF ASWP without any upfront Payment.
    Also We have reliable Storage Tanks (Tank Farm) and Vessel (CPA) Available at the port of Rotterdam for lease.

    Interested persons(Buyer) should contact me for further details and arrangements.

    Note: please dont send Message HERE, Send them via email or skype.

    Dr Aleksandr Fedorovich
    EMAIL:([email protected])
    SKYPE: business.spartanoil

  8. Hey Stan,
    Greeting of the day! Nice information you have shared with us how to find the real crude oil seller and buyer in Nigeria. Really very helpful and useful.
    Keep posting.

    Thank you..

  9. i have a genuine buyers from italy and londow, as matter of fact they have all the prove and capacity to buy oil, i really need a genuine seller to work with as soon as possible, here is my contact 08037692336 and email:[email protected] thanks and am looking to do business with any interested person.

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