In a dramatic shift for Nigeria's fuel market, depot prices for Premium Motor Spirit (PMS), commonly known as petrol, have crashed by approximately 14% in Lagos. This significant reduction comes on the heels of a major price cut initiated by the Dangote Petroleum Refinery, intensifying competition just ahead of the Christmas season.
Sharp Decline in Depot Prices Within a Week
Market checks reveal that private petroleum depot owners in Lagos have been forced to slash their prices to stay competitive. As of December 15, 2025, petrol is now selling for as low as N710 per litre at major depots. This marks a steep fall from an average of about N828 per litre recorded just a week earlier, on December 8.
The price adjustment represents a drop of N118 per litre, or 14.25%, in the span of seven days. Specific depots like Menj, Integrated Oil and Gas, Bovas, and A.A. Rano, which were previously selling between N826 and N829 per litre, have all aligned their prices downward to the new N710 benchmark.
Dangote Refinery Drives Market Realignment
Industry analysts and operators attribute this rapid price crash directly to the pricing strategy of the Dangote Refinery. The refinery has consistently reduced its gantry price, with Dangote-linked marketers currently selling PMS around N703 per litre in Lagos. This aggressive move left little room for other depot operators to maintain their previously higher rates.
Initially, some depot owners attempted to hold prices close to N800 per litre. However, they faced slow sales, growing stockpiles, and resistance from buyers who had access to cheaper alternatives. The proximity of Lagos to the supply source and its status as the nation's largest fuel consumption hub made it the first and fastest market to react to this competitive pressure.
A depot operator explained that once cheaper Dangote products flooded the market, selling at a higher price became unsustainable, forcing the widespread price corrections seen across Lagos depots.
Implications for the Market and Consumers
The intensified competition has created a rush among petroleum marketers and bulk buyers to purchase and restock products at the new, lower rates. This depot-level price crash is also beginning to reflect at some retail pumps. The Nigerian National Petroleum Company Limited (NNPC) has adjusted its pump prices downward in response, reducing petrol from N890 to N875 per litre in Lagos and from N920 to N915 per litre in Abuja.
Furthermore, Dangote has set a retail price of N739 per litre at its partner filling stations, declaring an end to prices as high as N970 per litre. This series of reductions signals a major shift in Nigeria's downstream oil sector, where pricing is becoming more dynamic and responsive to market forces rather than speculation.
Analysts caution that the sustainability of these lower prices depends heavily on Dangote Refinery maintaining steady supply levels throughout the festive period. Any disruption in supply or an increase in distribution costs could slow or reverse the downward trend. For now, Lagos stands as the clear battleground, demonstrating how the entrance of a major domestic refinery is reshaping the pricing landscape for petroleum products in Nigeria.
