The decision by the Nigerian National Petroleum Company Limited (NNPC) to sell petrol from the Dangote Refinery at prices higher than imported fuel has raised eyebrows among oil marketers in Nigeria. The Independent Petroleum Marketers Association of Nigeria (IPMAN) has questioned the logic behind this pricing strategy, arguing that it defeats the purpose of having a local refinery.
Dangote Refinery Petrol Prices
On Monday, the NNPC released the estimated pump prices of petrol obtained from the Dangote Refinery across its retail stations in Nigeria. According to the pricing template, petrol from the Dangote Refinery will sell for:
- N950.22 per litre in Lagos and its environs
- N960.22 per litre in Oyo State
- N980.22 per litre in Rivers State
- N992.22 per litre in the Federal Capital Territory (FCT)
- N999.22 per litre in Kaduna, Kano, and Sokoto States
- N1,019.22 per litre in Borno State
These prices are based on September 2024 pricing and are higher than the current pump price of petrol in Nigeria, which ranges from **N855 to N897 per litre**.
Marketers’ Concerns
IPMAN’s National Welfare Officer, John Kekeocha, expressed his concerns during an interview on Channels Television’s “The Morning Brief” breakfast programme. He argued that it doesn’t make sense for the NNPC to sell locally sourced petrol from the Dangote Refinery at a higher price than imported fuel.
“If NNPC can sell Dangote product higher than the imported product, it doesn’t make sense. What is the celebration we’re having all this while then?” Kekeocha questioned.
He explained that the assumption was that the product should be relatively cheaper because it is no longer being shipped in from abroad. Kekeocha further argued that the fuel the NNPC is getting from the Dangote Refinery cannot be more expensive than the imported one because it has the advantage of removing a significant part of the supply logistics.
NNPC’s Response
The NNPC has maintained that the prices are determined by market forces, as mandated by the Petroleum Industry Act (PIA), and not set by the government. The company has also stressed that the petrol loaded from the Dangote Refinery was priced in dollars, as Naira sales will commence in October.
In a statement, the NNPC assured that if the quoted pricing is disputed, it will be grateful for any discount from the Dangote Refinery, which will be passed on 100% to the general public.
What it means for the Petroleum Sector
The pricing of petrol from the Dangote Refinery has sparked debates about market dynamics and regulatory practices in Nigeria’s petroleum sector. Many Nigerians had expected that locally produced petrol would offer significant relief from the ongoing cost-of-living crisis in the country.
IPMAN’s concerns highlight the need for transparency in the pricing structure and production costs of the Dangote Refinery. The association emphasizes that maintaining competitive pricing is crucial for the success of the refinery and for fostering a sustainable fuel market in Nigeria.
The decision by the NNPC to sell petrol from the Dangote Refinery at prices higher than imported fuel has raised valid concerns among oil marketers in Nigeria. IPMAN’s argument that locally produced petrol should be cheaper than imported alternatives resonates with many Nigerians who were hoping for relief from high fuel prices.By Joseph Johnston
Youth Editor,
Egogonews Hub
