- IPMAN: Direct sourcing from Dangote driving down fuel prices nationwide.
- Disputed 28-million-litre supply agreement sparks mixed reactions.
The Dangote Petroleum Refinery has announced a reduction in the price of Premium Motor Spirit (PMS) from N990 per litre to N970 per litre, signaling a potential shift in Nigeria’s downstream oil market. This price, applicable to marketers, reflects efforts to bolster domestic supply and foster competition.
In a statement on Sunday, Anthony Chiejina, Group Chief Branding and Communications Officer of Dangote Group, described the move as a gesture of appreciation to Nigerians for their support and encouragement.
“As the year comes to an end, this is our way of appreciating the good people of Nigeria for their unwavering support in making the refinery a reality. We also thank the government for their cooperation, which has helped encourage domestic enterprise for collective prosperity,” Chiejina said.
He assured Nigerians that the refinery remains committed to delivering top-quality, environmentally sustainable petroleum products while ramping up production to meet domestic demand.
Competition Drives Price Reduction
The Independent Petroleum Marketers Association of Nigeria (IPMAN) attributed the downward trend in petrol prices to increased competition, facilitated by the deregulation of the downstream sector and direct transactions with the Dangote Refinery.
IPMAN spokesman Chinedu Ukadike noted, “Our direct dealings with Dangote are already pushing prices down. Before the end of the year, Nigerians should expect further reductions as market competition intensifies.”
Recent reports confirm that independent and major marketers have adjusted pump prices, with some stations reducing prices by N10 to N15.
A major oil marketer, speaking anonymously, explained that the competition has quietly reduced pump prices. “People aren’t noticing the drop because there’s no fanfare. Deregulation is working, and competition is driving this positive trend,” the source said.
Controversial 28 Million Litres Agreement
A purported resolution involving Dangote Refinery, the Nigerian National Petroleum Company Limited (NNPC), and other stakeholders allegedly mandates the supply of 28 million litres of PMS daily for six months to the Nigerian market. This agreement, reportedly brokered during a November 13 meeting, aims to stabilize fuel supply and reduce reliance on imports.
However, the NNPC and Dangote Group have denied knowledge of such an agreement.
NNPC Chief Communications Officer, Olufemi Soneye, dismissed the claims as “untrue,” while Dangote Group’s Anthony Chiejina labeled the reports as speculative.
Despite the denials, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) insists the deal is genuine, asserting that the agreement would bolster market stability and price regulation.
Looking Ahead
While disputes persist over the specifics of the agreement, analysts believe the price reduction and increased supply from Dangote Refinery signal a turning point for Nigeria’s energy sector. The development highlights the impact of deregulation and the role of domestic refineries in shaping the market.
With competition heating up and stakeholders aligning, Nigerians can look forward to improved fuel availability and potentially lower prices as the year progresses.
