Imported Petrol Costs Fall Below Dangote Refinery's Gantry Price Amid Market Adjustments
In a significant shift in Nigeria's energy landscape, the landing cost of imported Premium Motor Spirit (PMS), commonly known as petrol, has now dipped below the gantry price set by the Dangote Petroleum Refinery. This development follows a recent price adjustment by the refinery, which has raised its PMS gantry price from N699 to N799 per litre, making locally refined petrol approximately N70 more expensive than imported products at current rates.
Data Reveals Lower Import Costs and Refinery Price Hike
According to data released by the Major Energies Marketers Association of Nigeria (MEMAN), the landing cost of imported petrol stood at N728.88 per litre as of last week. In contrast, the Dangote Petroleum Refinery announced on Monday night that it had increased its PMS gantry price to N799 per litre. This move has created a notable price gap, with imported petrol currently offering a lower cost alternative.
Checks by sources confirmed that MRS filling stations, in line with the refinery's directive, have adjusted their pump prices from N739 to N839 per litre. The refinery explained that this price change represents a modest realignment after the festive season, noting that earlier reductions were temporary measures aimed at easing financial pressure on Nigerians during the holidays.
Refinery Cites Seasonal Adjustments and Market Stability
In a detailed statement, the Dangote refinery clarified that it had absorbed significant costs during the festive period to support affordability and market stability, marking the second consecutive year of such interventions. The company emphasized that despite the price reduction, many filling stations failed to reflect the new prices at the pump, denying Nigerians the intended benefits.
"With the festive period concluded, PMS prices have been realigned to sustainable levels to support long-term market stability," the refinery stated. It also reaffirmed its commitment to uninterrupted nationwide supply, highlighting its role in bolstering Nigeria's energy security.
Industry Dynamics and Stakeholder Reactions
Speaking on the development, David Bird, Chief Executive Officer of the Dangote refinery, noted that the facility supplies about 50 million litres of PMS daily, with distribution running smoothly across the country. He added that the refinery's flexible design allows it to process various crude types, ensuring stable output even during maintenance periods.
Industry data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) showed a shift in supply patterns: petrol imports declined from 52.1 million litres per day in November to 42.2 million litres per day in December, while Dangote refinery's supply increased from 19.5 million to 32 million litres per day within the same period.
Sources within the Dangote Group indicated that the December price cut was strictly seasonal, and the latest adjustment is a return to prevailing market realities. Meanwhile, Billy Gillis-Harry, National President of the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), suggested that the earlier price reduction aimed to increase Dangote's market share.
He warned that stakeholders should be allowed to compete on a level playing field to avoid market dominance. Dangote has repeatedly denied allegations of monopoly, arguing that importing petrol while local refining capacity is available amounts to economic sabotage.
Uncertain Future for Fuel Importers and Market Competition
It remains unclear whether fuel importers will leverage the lower landing cost to sell petrol below Dangote's current retail price, potentially intensifying competition in the sector. This situation has sparked debates among industry players, with some expressing concerns over pricing dynamics and market fairness.
The refinery's price hike reflects a strategic move to maintain sustainable operations after temporary interventions, but it raises questions about the long-term implications for consumers and the broader energy market in Nigeria. As stakeholders remain divided, the evolving landscape underscores the complexities of balancing affordability, competition, and energy security in the country.
