“Greek Gift”: Marketers Warn Against Dangote’s Fuel Plan, May Push Petrol to N2,500/litre

• The PETROAN has cautioned against Dangote Refinery’s plan to distribute fuel directly, warning it could lead to market monopoly, job losses, and eventual price hikes
• PETROAN President Billy-Gillis Harry urged government intervention to prevent domination of the downstream sector and to protect smaller businesses
• In response, Dangote Refinery stated it aims to improve fuel supply efficiency, reduce production costs through direct sales and better logistics

Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology, Banking and the Economy.

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has raised concerns over Dangote Refinery’s plan to distribute fuel directly across Nigeria, calling it a potential “Greek gift.”

The association’s national president, Billy-Gillis Harry, warned that the move could mirror Dangote Group’s past dominance in sectors like cement, flour, and sugar, where initial benefits eventually gave way to price hikes and limited competition.

He said:

“I think Nigerians need to be careful about accepting a ‘Greek gift’. We need to be much more insightful, as we have experienced it in different spheres of the economy, whether it is flour, sugar, or cement."

Gillis-Harry pointed out that although cement was once sold directly at various locations, prices never truly dropped.

He fears the same pattern may emerge in the fuel market, where small players might be pushed out, only for prices to later soar.

He added:

“So there is no anticipation that when everybody is drummed out of the business by these kinds of gifts, we wouldn’t get back to the same position where we would start looking to buy petroleum products for N2,500 per litre. It has happened in other areas. We are courageous enough to stand by our point.”

In an earlier interview with Legit.ng, Billy-Gillis Harry expressed concern over Dangote Refinery’s proposed forward integration approach, where the company would not only produce but also distribute fuel.

He cautioned that this strategy could lead to monopolistic control within the downstream oil sector.

According to him, such dominance could seriously harm smaller businesses and result in widespread job losses across the petroleum value chain.

He urged the government to step in with proper regulations to prevent any single player from taking over the market and to ensure fair competition for all stakeholders.

Dangote defends fuel distribution initiative

Dangote Refinery has explained that its new fuel distribution plan is aimed at enabling smooth and efficient delivery of petroleum products nationwide.

The refinery stated that all filling stations buying petrol and diesel directly from Dangote will benefit from improved logistics support.

It also emphasised that vital industries such as manufacturing and telecommunications stand to gain significantly, as lower fuel prices could help reduce production expenses, ease inflation, and support economic growth.

The refinery noted that businesses in these and other sectors can now buy fuel directly from its facility.

The 650,000-barrel-per-day refinery came on stream in January 2024, first rolling out diesel and aviation fuel A1. PMS rollout followed nine months later, in September 2024.

As of February this year, the refinery disclosed that it had reached 85 per cent of its installed capacity, expressing confidence in the speedy attainment of full capacity.

CORAN explains Dangote's perceived monopoly

Meanwhile, Legit.ng earlier reported that the perception of Dangote Refinery as a monopoly has been attributed to the FG's failure to provide adequate crude oil supply to smaller refineries.

CORAN argued that the real threat to competition is not Dangote's Refinery, but the FG's inaction and lack of support for modular refineries

The organisation called for immediate government intervention to guarantee crude oil access for all refineries and ensure fair pricing and infrastructure sharing.

Source: Legit.ng