Nigeria's midstream and downstream petroleum regulator has defended Dangote Petroleum Refinery's decision to price refined petroleum products in U.S. dollars, stating that the Petroleum Industry Act (PIA) explicitly permits operators to recover costs incurred in foreign currency.
Senior officials at the regulatory body, who spoke anonymously because they lacked authorisation to comment publicly, said the legal framework grants operators the right to recoup eligible operating expenses and earn reasonable returns on their capital. The clarification came after Dangote Refinery directed marketers to pay for petrol, diesel, and aviation fuel in dollars for all gantry and coastal transactions, ending the previous naira-based pricing structure for those sales channels.
Why the Refinery Switched to Dollar Pricing
Regulatory sources said the core justification for the policy lies in the refinery's cost structure: a substantial portion of its crude oil procurement and operating expenditure is settled in dollars. An official quoted said: "If an operator incurs costs in dollars, the Petroleum Industry Act allows those costs to be recovered in the same currency."
The officials also noted that the refinery has been compelled to source crude from international markets after domestic supply under the federal government's naira-for-crude arrangement proved insufficient to meet its needs. Rising global oil prices have further inflated feedstock costs, making dollar pricing commercially unavoidable, according to the sources. They urged bodies responsible for crude allocation, particularly the Nigerian National Petroleum Company Limited (NNPC), to resolve the supply gaps undermining the naira-for-crude scheme.
Dangote Sells Petrol in Dollars
Legit.ng reported that Dangote Refinery formally notified marketers that all previously issued naira-denominated proforma invoices for coastal and gantry dealings had been voided. Under the revised schedule, petrol through the gantry is priced at $0.779 per litre, diesel at $1.087 per litre, and aviation fuel at $0.942 per litre, while coastal petrol supplies are set at $1,044.62 per metric tonne. The refinery confirmed that transactions involving liquefied petroleum gas will continue in naira.
The announcement has drawn sharp criticism from across the downstream sector. Petroleum marketers argued that having to source dollars to purchase fuel that is then sold to Nigerian consumers in naira would strain the already tight foreign exchange market. Depot operators have already responded by raising petrol and diesel loading prices, as marketers factor in higher replacement costs under the new regime.
Diesel Price Rises by 86.40%
Earlier, Legit.ng reported that the National Bureau of Statistics (NBS) disclosed that the average retail price of Automotive Gas Oil (AGO), commonly known as diesel, increased by 86.40% year-on-year to N3,277.47 per litre in May 2026. According to the latest diesel price watch report released by the statistics agency, the figure rose from N1,758.26 per litre recorded in May 2025. The report also showed that diesel prices increased by 32.44% on a month-on-month basis, rising from N2,474.69 per litre in April 2026 to N3,277.47 per litre in May.
