Dangote Refinery Reduces Diesel Price by N100 Again
Dangote Refinery has announced another reduction in the price of Automotive Gas Oil (AGO), commonly known as diesel, slashing it by N100 to N1,500 per litre. This marks the second price cut within a week, driven by heightened competition in Nigeria's downstream petroleum market.
The latest adjustment represents a 6.25 percent decrease from the previous price of N1,600 per litre. Just last Tuesday, the refinery had reduced the price from an earlier level to N1,600. The consecutive cuts come as depot operators lower their rates to attract customers amid a decline in global crude oil prices.
Market Competition Drives Prices Down
Data from industry sources indicate that several depots are now selling diesel below N1,600 per litre. According to Petroleumprice.ng, average transaction prices across multiple depots range between N1,565 and N1,570 per litre, depending on stock levels, cash positions of traders, and other market dynamics. Industry participants attribute the falling diesel prices to rising competition and what they describe as "panic selling," with traders prioritizing quick stock turnover over wide profit margins.
A company official stated: "We will continue to adjust our prices down if private depots keep dropping below our benchmark and the competitive structure of the market drives prices lower. For the deregulated market, supply and demand dictates the direction."
Impact of Lower Crude Oil Prices
The price reduction aligns with softening global crude oil prices. Brent crude traded at $79.53 per barrel, down 0.40 percent, while West Texas Intermediate (WTI) crude eased 0.03 percent to $75.83 per barrel. The decline in diesel costs is expected to bring relief to manufacturers and transport companies, which heavily rely on the product. Lower diesel prices could help reduce operational expenses, improve profit margins, and ease pressure from rising production and logistics costs.
Aviation Fuel Price Also Reduced
In a related development, Dangote Refinery also reduced the price of Aviation Turbine Kerosene (ATK), or jet fuel, by N100 per litre to N1,450. This represents a 6.5 percent decline from the previous price of N1,550. The adjustment reflects recent movements in crude oil prices and improving global supply conditions. Airlines, which face high operational costs partly due to jet fuel expenses, are expected to benefit from this reduction.
