Dangote Refinery Announces Significant Petrol Price Reduction
The Dangote Petroleum Refinery & Petrochemicals has made a major announcement regarding fuel pricing in Nigeria. In a statement released on Thursday, the refinery confirmed it has reduced its gantry price for petrol to ₦1,200 per litre, representing a substantial ₦75 decrease from the previous price of ₦1,275 per litre.
Coastal Facilities Also See Price Adjustment
Alongside the gantry price reduction, the refinery has also lowered the price for petrol at its coastal facilities to ₦1,153 per litre. This dual adjustment comes at a time when global oil markets are experiencing significant volatility due to ongoing tensions in the Middle East region.
The refinery's statement emphasized that this price review marks a downward adjustment in their pricing structure and is expected to influence fuel supply costs across various distribution channels, including depots and retail outlets throughout Nigeria.
Recent Price Fluctuations and Global Context
This price reduction follows several recent increases in petrol pricing by the refinery. On March 13th, the price stood at ₦1,175 per litre, which increased to ₦1,245 per litre on March 20th, before reaching ₦1,275 per litre on March 21st. The current reduction to ₦1,200 per litre represents a significant reversal in this upward trend.
What makes this price cut particularly noteworthy is that it comes despite rising global oil prices. Brent crude oil, the international benchmark, reached $100.54 per barrel on Thursday, showing a substantial increase from $96 per barrel recorded on Monday. This price movement followed US President Donald Trump's announcement delaying military strikes against Iranian power plants and energy facilities for five days.
Supply Challenges and Operational Realities
In a recent interview on Arise TV, David Bird, Chief Executive Officer of Dangote Refinery, revealed significant challenges in crude oil supply. Despite agreements under the Federal Government's crude-for-naira arrangement, the refinery is receiving only about five shipments of crude oil monthly, far below the expected 13 to 15 shipments.
"What we see under that agreement, we should be getting about 13 to 15 cargoes a month," Bird explained. "And that's what we could process to meet the domestic fuel requirements of Nigeria. Currently, we're only getting five. So, that's an underperformance against that pre-agreed volume contract."
This supply shortfall has forced the refinery to source preferred Nigerian crude grades from international markets at higher costs, creating additional financial pressures. Bird emphasized that the crude-for-naira policy was designed primarily to stabilize Nigeria's foreign exchange market rather than provide financial advantages to the refinery itself.
Operational Capacity and Market Impact
Despite these supply challenges, Bird confirmed that the refinery continues to operate at its maximum installed capacity of 650,000 barrels daily, supplying both the local Nigerian market and surrounding regional markets. However, he noted that disruptions in global oil markets, particularly Middle East tensions, have driven up operational costs across the board, including shipping, insurance, and logistics expenses.
The refinery CEO stressed that fuel pricing remains determined by international market dynamics and clarified that the refinery receives no subsidies or discounts on the crude oil it processes. He called for improved planning in crude oil allocation and advocated for long-term strategies, such as building national reserves, to strengthen Nigeria's oil sector supply chain resilience.
This price reduction announcement comes against the backdrop of the International Energy Agency's March 13th statement that ongoing conflicts are causing the largest supply disruption ever witnessed in global oil markets, highlighting the complex environment in which Nigeria's largest refinery operates.
