Dangote Refinery Refutes Marketers’ Projection on Petrol Price

Tuesday, August 13, 2024

Petroleum marketers in Nigeria have been closely monitoring the developments at the Dangote Refinery, eagerly awaiting the release of its petrol into the market. However, recent statements from the refinery’s management have contradicted the expectations of some marketers.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) had projected that the Dangote Refinery would sell petrol at around N600 per liter, significantly lower than the prevailing market rates. They believed that the refinery’s 650,000-barrel-per-day capacity would allow it to crash the price of petrol, similar to what it did with diesel¹.

In a recent statement, the Dangote Refinery refuted these projections. The facility’s management clarified that they have not reached a pricing agreement with marketers regarding the product. While the refinery aims to be competitive, it cannot guarantee the specific price point that IPMAN had anticipated².

Hammed Fashola, the IPMAN national vice president, had previously stated that the Dangote Refinery could reduce fuel costs if it received adequate support regarding crude oil supply. Currently, the Nigerian Petroleum Company Limited (NNPCL) sells petrol to marketers at N570 per liter, while IPMAN members purchase from private depots at prices above N700. The hope was that Dangote’s pricing would be more favorable, potentially around N600 per liter¹.

The Dangote Refinery had successfully lowered diesel prices from N1,600 to N1,000 per liter, benefiting consumers. Now, Nigerians are eagerly awaiting a similar reduction in petrol prices once the refinery begins operations¹.

While the Dangote Refinery’s impact on petrol prices remains uncertain, the market awaits further developments. As the facility prepares to launch its products, both marketers and consumers are keenly observing any shifts in pricing dynamics¹.