Marketers Give Reasons Diesel Will Not Sell for N950 Despite Dangote Refinery's Price Crash

Marketers Give Reasons Diesel Will Not Sell for N950 Despite Dangote Refinery's Price Crash

  • Marketers have explained that selling diesel to Nigerians at a price below N1,000 is not possible for now
  • This is despite the announcement of a price crash by the Dangote refinery, which offers marketers the opportunity to purchase at 940 per litre
  • The marketers explained that after purchasing products, they must take into consideration taxes, distribution costs, and regulatory hurdles to break even journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trend.

Nigerians will not be able to buy diesel below N1,000 at filling stations yet despite the fact that Dangote Petroleum Refinery announced a further reduction in the product price to N940 on Tuesday, April 23, 2024.

Tuesday's slash is the third major reduction in diesel prices by the Dangote refinery in less than three weeks.

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Diesel price in Nigeria is a subject of interest after Dangote refinery slashed price for marketers
Diesel price to remain above N1,000 at filling stations Photo credit: Pius Utomi Ekpei
Source: Getty Images

Despite the reduction, filling stations are still selling diesel above N1,300 as of Wednesday morning.

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Why Diesel will not sell below N1,000

Oil marketers explained that several complexities impede the translation of the Dangote refinery reduction into the product's pump price at the filling station.

Abubakar Maigandi, the national president of the Independent Petroleum Marketers Association of Nigeria (IPMAN), noted that the factors include transportation costs, taxes, and old stock in most of the tanks in their filling stations, Punch reports.

His words:

Marketers are happy about the reduction in the price of diesel from the Dangote refinery but still we are appealing to him to further reduce the price. Let them try as much as possible to see how we can get it at N800/litre.
“However, we must state that he has tried and marketers are happy because of the reductions being carried out by Dangote refinery since they started releasing diesel into the domestic market.”

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On the continued high prices, Maigandi added:

The reduction in prices from Dangote refinery won't be seen at the pumps for now because most marketers have stocks they bought at N1,225/litre .
"With time, the price will drop. Already, pump price has dropped from N1,600 per litre to around N1,300 to N1,350 per litre, depending on the location, so it will take a bit more time."

Tinubu reacts to reduced diesel prices

Earlier, reported that President Bola Tinubu commended Dangote Oil and Gas Limited for slashing the price of Automotive Gas Oil (AGO), also known as diesel, from N1200 to N1000.

The reduction was effected after the initial decrease from N1,650 to N1200 about three months ago.

Tinubu said the price review, which represents a 60% drop, would impact the prices of various goods and services.


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