Nigeria's fuel market is experiencing significant turbulence as Dangote Petroleum Refinery's recent price reduction sends shockwaves through the downstream sector. The massive refinery slashed its ex-depot price by nearly N60 per litre, triggering immediate reactions from filling stations and petroleum marketers across key economic regions.
Market Reacts to Dangote's Strategic Price Cut
Last week, Dangote Refinery announced a dramatic reduction in petrol prices, cutting rates from N887 to N828 per litre at its depot. This N59 decrease represents one of the most substantial single price adjustments since the refinery commenced operations, creating immediate ripple effects throughout Nigeria's petroleum distribution network.
The price slash has compelled filling stations selling Dangote petrol to quickly adjust their pump prices downward. Field investigations across Lagos metropolis conducted on Tuesday, October 11, 2025, revealed that numerous stations have already reduced their rates to approximately N900 per litre, down from previous prices ranging between N915 and N920.
Filling Stations Confirm Immediate Adjustments
Station managers and attendants confirmed that the refinery's strategic move directly influenced their new retail pricing structures. At an AP filling station in Ikoyi, manager Nurudeen Olalekan explained the transitional phase affecting current prices.
"We are currently selling old stock purchased at the previous rate of N887 per litre," Olalekan stated. "Once we begin receiving new supplies at the reduced N828 rate, consumers can expect further decreases, potentially bringing pump prices down to N850 or even lower."
The trend extended beyond Lagos, with Ogun State witnessing similar adjustments. Stations operated by major marketers including MRS and Heyden in the Ifo area reduced their prices from N950 to N920 per litre, with operators indicating that additional reductions might follow in the coming days.
Importation Halts as Marketers Rethink Strategy
The persistent price reductions from Dangote Refinery are forcing petroleum marketers to completely reconsider their importation strategies. Major industry players acknowledge that importing petrol has become economically unviable, particularly with the Federal Government's 15% import tariff on refined products.
Clement Isong, Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN), confirmed the temporary suspension of imports. "Dangote's pricing represents a fundamental market shift," Isong explained. "It no longer makes economic sense to import petroleum products when the refinery offers significantly cheaper rates domestically."
Isong further elaborated on Dangote's pricing methodology, noting that the refinery employs an import parity model that considers global crude costs, freight charges, and logistics expenses. Rather than reacting to daily market fluctuations, Dangote monitors 30-day average prices, creating more stability in supply and pricing over extended periods.
Analysts Warn About Market Volatility
Despite the current downward trend, energy policy experts caution Nigerians against expecting prolonged price stability. Adeola Yusuf, an energy policy analyst, emphasized the inherent volatility in Nigeria's deregulated petroleum market.
"Nigerians should understand that petroleum product prices remain highly susceptible to global crude oil prices," Yusuf stated during a telephone interview. "We could wake up tomorrow and find that market conditions have completely changed. Price instability is characteristic of deregulated markets."
The ongoing price competition between Dangote Refinery and private depot operators has evolved into a fierce battle for market dominance. Both sides continue introducing fresh price reductions in efforts to secure customer loyalty and expand their market share.
This renewed rivalry emerges amid growing concerns about the federal government's planned 15% import tariff on petrol, which industry analysts warn could destabilize Nigeria's still-fragile deregulated fuel market. The current developments highlight Dangote Refinery's increasing influence in shaping Nigeria's energy landscape and its growing capacity to determine market directions.
