BUSINESS: PRICE HIKE — IMPORTED FUEL CHEAPER THAN DANGOTE PETROL DESPITE NAIRA-FOR-CRUDE DEAL
Read Time:2 Minute, 52 Second
BY:TAJUDEEN AMINAT
The landing cost of imported petrol has once again dropped below the price of petrol from the Dangote Refinery, despite the refinery benefiting from the Nigerian government’s naira-for-crude arrangement.
Data released by the Major Energies Marketers Association of Nigeria on March 2 indicated that the landing cost of imported petrol stood at N809.83 per litre amid the ongoing conflict in the Middle East.
In contrast, the gantry price at the Dangote Refinery rose to N874 per litre after the 650,000-barrel-per-day facility increased its price by N100 on Monday, citing a surge in crude oil prices linked to the Middle East crisis.
This indicates that imported fuel is N64.2 per litre cheaper than petrol from the Dangote Refinery.
The media reports that the refinery’s recent price adjustment has triggered a nationwide increase in retail petrol prices. Filling stations in Abuja and neighbouring states—Nasarawa, Kogi, and Niger—now sell petrol between N960 and N980 per litre, up from the previous range of N855 to N899.
Notably, MRS filling stations, which are backed by Dangote, currently sell petrol at N975 per litre—N15 higher than outlets operated by the Nigerian National Petroleum Company (NNPC), AA Rano, Ranoil, and other retailers, where the product sells for around N960 per litre.
The development underscores the ongoing price competition in Nigeria’s downstream oil sector, with consumers bearing the impact of persistent fuel price volatility.
Commenting on the situation, the Major Energies Marketers Association of Nigeria (MEMAN) said the market remains highly uncertain.
Meanwhile, Dangote Refinery, the $20 billion facility, explained in a statement on Thursday that the latest N100 per litre increase in its gantry price was driven by rising crude oil prices.
According to the refinery, it absorbed 20 percent of the increase in crude oil costs, while the remaining portion was reflected in the new price.
“The refinery implemented a measured adjustment of N100 per litre in its ex-depot price of Premium Motor Spirit, representing an increase of about 12 percent. The refinery has absorbed 20 percent of the cost escalation, for now, to cushion the domestic market,” the company stated.
On the naira-for-crude deal with the Nigerian government, which commenced in 2024, Dangote Refinery confirmed that the arrangement is in effect but noted that it still relies heavily on crude sourced through export channels.
The refinery said the Nigerian National Petroleum Company Limited (NNPCL) currently supplies about five crude cargoes monthly, which are paid for in naira, while it sources an additional 13 cargoes through export markets.
“Furthermore, while we receive about five cargoes a month from NNPC, which we pay for in Naira, these cargoes are priced at international market prices plus a premium and fall short of the 13 cargoes that we require to support sales into Nigeria,” the refinery said in a recent statement.
The media reports that stakeholders have raised concerns over the continued impact of global crude oil market shocks despite the implementation of the naira-for-crude arrangement with the Dangote Refinery. The concern was recently echoed by lawyer Deji Adeyanju.
At the time of filing this report, Brent crude was trading at $85.12 per barrel, while West Texas Intermediate stood at $80.54.
The media also reports that in February, imported fuel was N77 per litre cheaper than Dangote petrol, at a time when crude oil prices were relatively stable.
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