Dangote Petroleum Refinery has once again lowered its petrol prices, causing significant concern among petroleum product importers. The refinery’s latest N65 reduction, bringing the ex-depot price to N825 per litre, follows several previous price cuts and threatens to force importers to sell below their cost.
This repeated price reduction strategy by Dangote, is aimed at benefiting Nigerian consumers, is creating a challenging market for those who still import refined petroleum products.
Dangote Refinery’s management has emphasized its commitment to providing relief to Nigerians, particularly during the upcoming Ramadan season, and supporting the government’s economic recovery efforts. They highlighted the consistent lowering of prices as a means to ease the financial burden on the populace and ensure a stable fuel supply. The refinery has announced that its products will be available at competitive prices through its partner retail outlets, including MRS, Heyden, and Ardova, across the country.
However, importers are expressing alarm over the impact of these price reductions on their businesses. With landing costs exceeding Dangote’s ex-depot price, they face potential losses and reduced competitiveness. Some importers believe that Dangote’s pricing strategy is intentionally designed to discourage fuel importation, pushing them to source products locally. They fear that they will be forced to sell at a loss to compete, or cease importing altogether.
Industry stakeholders, such as the Independent Petroleum Marketers Association of Nigeria (IPMAN), have acknowledged the difficulties faced by importers. While recognizing the potential for losses, IPMAN has also commended Dangote’s achievement and pledged continued patronage. They have called on the government to improve distribution infrastructure, such as depots and pipelines, to ensure efficient product delivery across the country.
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The price reductions have been widely welcomed by consumer groups and retailers, who believe that Nigerians will benefit from lower fuel prices. The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) has also applauded Dangote’s efforts. However, concerns remain about the long-term effects on competition and the need for a level playing field for all market participants.
In addition to supplying the domestic market, the Dangote refinery has begun exporting petroleum products, including low-sulphur fuel oil and aviation fuel. These exports demonstrate the refinery’s capacity to meet both local and international demand. Aliko Dangote, the refinery’s president, has asserted that the facility has ample stock to satisfy Nigeria’s requirements and export to other countries.
Dangote has also boasted about the quality of his refinery’s product, and that other refineries are shutting down due to his refinery’s output. He claims that his refinery has over 500 million liters of petrol in stock, worth over N600 billion, and that it can meet 100 percent of Nigeria’s needs.
