Dangote Refinery Cuts Cooking Gas Price to N790/kg Amid Global Oil Volatility
Nigeria's liquefied petroleum gas (LPG) market, commonly known as cooking gas, is undergoing significant price adjustments following recent rate reviews by major suppliers, including the Dangote Refinery and private depot operators. This development occurs against a backdrop of volatility in global crude oil markets, primarily driven by escalating tensions in the Middle East.
Global Oil Tensions Drive Energy Price Surge
Recent geopolitical events in the Gulf region have triggered a sharp increase in international crude oil prices, which surged by more than 30% within a short period. The spike is largely attributed to tensions involving the United States, Israel, and Iran, raising concerns about potential disruptions to global oil shipments.
The situation has particularly affected key shipping routes, such as the Strait of Hormuz, a critical energy corridor through which a substantial portion of global crude supply passes. Industry observers note that uncertainty surrounding this waterway has created ripple effects across energy markets, driving up prices for petroleum products including petrol and cooking gas.
Energy policy analyst Adeola Yusuf emphasized that developments in the Gulf region are impacting global markets significantly. "The entire world is affected by what is happening in the Gulf region, and Nigeria is not insulated," Yusuf stated in a phone interview. He added that energy markets are currently experiencing substantial volatility, with countries like the United Kingdom already witnessing energy price surges over the past two weeks.
Dangote Refinery Reduces LPG Price Despite Global Pressure
Despite the global pressure on energy prices, the Dangote Refinery has taken a notable step by reducing its liquefied petroleum gas price. The refinery reportedly lowered its LPG price from above N1,000 per kilogram to approximately N790 per kilogram, a move that could potentially ease the cost burden on consumers if the reduction filters through the supply chain effectively.
However, this adjustment has not yet been fully reflected across major gas depots, with several operators maintaining higher prices. Data from industry sources reveals significant price disparities:
- Matrix Warri currently sells at about N1,005 per kilogram
- Ardova maintains a price of N975 per kilogram
- Techno Oil sells at N910 per kilogram
Dangote's price of roughly N790 per kilogram remains the lowest among major suppliers, highlighting the lag between wholesale price adjustments and their impact on the wider market.
Retailers Begin Adjusting Prices in Lagos
At the retail level, some cooking gas sellers in Lagos have started adjusting their prices following the reduction announced by the Dangote Refinery. Olalekan Ajayi, a cooking gas retailer in the Iju area of Lagos, reported that retail prices had previously climbed to as high as N1,150 per kilogram during the recent price spike.
"Last week, we sold for as high as N1,150 per kilogram, but prices have started dropping slightly after Dangote and some depot operators reviewed their prices," Ajayi explained. Although the reduction remains modest, retailers anticipate further adjustments if depot prices continue to decline in the coming weeks.
Experts Urge Caution and Strategic Planning
Energy analysts emphasize that the current situation demonstrates how global geopolitical tensions can rapidly influence domestic energy costs. With uncertainty in the Middle East still unresolved, experts are advising governments and energy stakeholders to implement precautionary measures to protect supply chains and stabilize prices.
Analysts recommend building strategic reserves of key petroleum products, including cooking gas, to cushion consumers against future supply disruptions and price shocks. This approach could help mitigate the impact of international market volatility on Nigerian households and businesses.
The ongoing conflict involving the United States, Israel, and Iran continues to affect Nigerian households, with cooking gas prices experiencing sharp increases in recent weeks. New data indicates that depot rates have approached N1,000 per kilogram, while retail prices have climbed to around N1,300 per kilogram, reflecting the broader impact of rising crude oil and LPG prices on the international market.
