Dangote Refinery Increases Fuel Prices for the Fourth Time; New Rates of Petrol and Diesel Emerge
- Dangote Petroleum Refinery has increased the ex-depot price of petrol to N1,175 per litre
- Diesel prices have also been raised to N1,620 per litre from the previous N1,300
- The latest adjustment represents the fourth price revision by the refinery since March 2
Oluwatobi Odeyinka is a business editor at Legit.ng, covering energy, the money market, technology and macroeconomic trends in Nigeria.
The Dangote Petroleum Refinery has increased the ex-depot price of Premium Motor Spirit (PMS), commonly known as petrol, marking the fourth adjustment in its fuel pricing structure.
The refinery has raised the gantry price of petrol from N995 to N1,175 per litre, while Automotive Gas Oil (AGO), widely known as diesel, has also been increased to N1,620 per litre.
Source: Getty Images
Industry sources told Petroleumprice.ng that the refinery has communicated the updated price template to fuel marketers, reflecting the fourth revision since March 2.
The adjustments highlight ongoing pricing pressures in Nigeria’s downstream petroleum sector since the latest war between Iran and Israel started.
Fuel loading activities earlier suspended
The price adjustment follows a temporary suspension of petrol loading operations and restrictions on truck-out activities at the refinery.
The suspension had earlier sparked speculation among industry participants about a possible review of fuel prices.
Earlier today, marketers raised prices in anticipation of a further increase in gantry prices. Outlets of the Nigeria National Petroleum Company (NNPC) Limited have also raised pump prices above N1,000.
Global crude oil rally linked to price increase
The current hike in petrol prices was triggered by the ongoing conflict in the Middle East, where Iran and Israel, backed by the US, exchange missiles.
The conflict has caused a spike in crude oil prices in the global market, rising from less than $70 per barrel before the war to over $100 per barrel.
As of 1:00 pm West African Time on Monday, March 9, Brent crude traded at $102.8 per barrel, while West Texas Intermediate stood at $101.0 per barrel.
The rise in global crude prices is contributing to upward pressure on domestic fuel prices, as Nigeria remains vulnerable to the volatility of the international oil market.
Possible impact on Nigeria’s fuel market
Industry players note that pricing decisions by the Dangote Petroleum Refinery often influence fuel prices across major depots in Nigeria.
As a result, depot operators and marketers may adjust their prices to reflect the new gantry rates.
Observers say the latest development could affect petrol distribution costs and pricing across the country as stakeholders react to the new rates.
Source: Getty Images
Analysts defend Dangote’s price hikes
Meanwhile, energy analysts within Nigeria’s downstream oil industry have defended the hike in gantry price by the Dangote Refinery, Independent reported.
The analysts accused some fuel importers of attempting to discredit the refinery in order to preserve their long-standing control over petrol imports.
They noted that the cost of importing fuel has climbed sharply as international crude prices surged above $100 per barrel, driven largely by tensions in the Middle East. According to them, these conditions have pushed the effective landing cost of imported petrol close to N1,000 per litre.
Energy analyst David Okon, who spoke with the Independent, said the recent price adjustment was largely unavoidable given prevailing market realities.
He explained that the Dangote refinery operates in a deregulated environment and purchases crude oil at global market prices, which have risen significantly amid geopolitical instability in the Middle East.
Experts warn petrol, diesel prices may rise
Legit.ng earlier reported that energy experts had warned that petrol and diesel prices in Nigeria could skyrocket if crude oil exceeds $90 per barrel.
Rising tensions in the Middle East have increased volatility in the global oil market. Brent crude is currently $101.9, according to Oilprice.com.
Analysts said Nigeria remains exposed to global oil price volatility because local refineries still import significant volumes of crude
Source: Legit.ng
