Marketers Predict Lower Petrol Price as Dangote Refinery Begins Direct Fuel Supply Nationwide
- Dangote Refinery moves closer to full national supply, potentially lowering petrol prices below N739 per litre
- Training for partner filling station staff signals imminent rollout of direct petrol deliveries from the refinery
- Price competition intensifies as new supply networks challenge higher-cost marketers in Nigeria's petrol market
Petrol prices may ease further across Nigeria as Dangote Refinery moves closer to full nationwide direct supply of Premium Motor Spirit (PMS) to its partner filling stations, according to industry operators.
Independent marketers aligned with the refinery say the new supply arrangement could push pump prices below the current N739 per litre benchmark in some locations, especially where competition is intense, and logistics costs are significantly reduced.
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Training signals start of direct delivery rollout
Industry sources confirmed that the refinery has commenced virtual training for staff of affiliated retail outlets, a key step ahead of the rollout of free direct delivery of petrol from the refinery to partner stations.
The training, which began earlier this week, is expected to be followed almost immediately by physical product deliveries.
Once fully implemented, the arrangement will remove several layers of distribution costs, including third-party haulage and depot handling charges.
Participating marketers in the Dangote Refinery partnership include MRS Oil Nigeria, Ardova Petroleum, Heyden Petroleum, Garima Petroleum and Optimal Energy.
Pricing flexibility opens for marketers
While MRS outlets have already been selling Dangote-refined petrol at the agreed pump price of N739 per litre, other partners have been unable to match the rate due to the absence of direct supply from the refinery.
The National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN) explained that the potential for lower prices lies in the gap between the refinery’s gantry price and the current retail price.
According to him, Dangote Refinery’s gantry price currently hovers around N699 per litre, leaving marketers with enough margin to compete aggressively once logistics costs are reduced or eliminated.
He noted that marketers benefiting from free delivery could pass part of the savings to consumers, making sub-N739 per litre pricing realistic at select outlets, particularly in urban centres with dense station clusters.
Abuja market shows sharp price gaps
A survey of filling stations in Abuja highlights the pricing disparities already present in the market.
MRS stations were observed selling petrol at N739 per litre, attracting long queues as motorists sought cheaper fuel. In contrast, several major marketers continued to sell between N840 and N920 per litre.
Independent stations in some areas priced petrol as high as N930 per litre, though with shorter queues and faster access, reflecting a trade-off between convenience and cost.
The wide variation underscores the impact distribution costs and supply chains continue to have on pump prices under Nigeria’s deregulated fuel market.
Competition set to intensify nationwide
Industry analysts say the expansion of Dangote Refinery’s direct delivery network could significantly reshape competition in the downstream petroleum sector.
Lower prices at partner stations are expected to put pressure on marketers operating with higher cost structures, particularly smaller retailers with thin margins and limited access to cheaper supply sources.
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As more outlets receive direct supply from the refinery, price competition is likely to intensify, potentially driving a broader downward adjustment in petrol prices across major cities and high-traffic corridors in the coming weeks.
Dangote Refinery delivers 43m litres of fuel in one day
Legit.ng earlier reported that Dangote Petroleum Refinery dismissed reports that it shut down its petrol processing unit, revealing that it delivered 43.3 million litres of Premium Motor Spirit to the Nigerian market in a single day.
Officials of the refinery said the volume loaded on Saturday, January 3 alone was enough to meet more than half of Nigeria’s estimated daily petrol consumption, countering claims that production had been halted for maintenance.
The clarification follows widespread reports over the weekend that the refinery had suspended operations, a claim that triggered sharp increases in ex-depot petrol prices across major fuel trading hubs.
Proofreading by Kola Muhammed, copy editor at Legit.ng.
Source: Legit.ng
