DANGOTE-REFINERY
By Olayiwola Mercy
Dangote Refinery has reduced the price of petrol to N828 per litre, marking a 5.6% decrease from the previous price of N877. This move is expected to bring relief to fuel marketers and consumers nationwide, following weeks of elevated pump prices. The reduction is attributed to a strengthened crude supply arrangement between Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPC Ltd) under the naira-for-crude framework.
Under this deal, NNPC Ltd will supply the 650,000-barrels-per-day refinery with five December-loading crude cargoes, including Amenam, Bonny Light, Forcados, and Qua Iboe grades. This arrangement has improved supply stability and reduced cost pressures on the refinery. Depot operators in Lagos have confirmed that loading at the new price started early Friday, and a similar decrease in prices at retail stations is expected to follow suit in the coming days.
The price adjustment is a significant step in Dangote’s bid to stabilize fuel supply and drive down pump prices through domestic production. According to company sources, the price slash was made possible through the new naira-for-crude arrangement, which reduces operational costs and shields the refinery from fluctuations in foreign exchange rates. Economists say Dangote’s decision could have wider economic implications, particularly for transport and food prices, which are heavily influenced by fuel costs.
Industry observers predict that the move could ignite a new round of competition, with other marketers, including NNPC Retail, likely to adjust prices to maintain market share. Despite global crude oil averaging $64 per barrel, Dangote’s new pricing model allows it to refine at a lower cost, an advantage that now positions it below import parity. Marketers at the Lagos loading bay confirmed that petrol loading commenced early Friday at the new price, prompting expectations that pump prices could drop in the coming days.
The reduction in petrol price is also expected to have a positive impact on the Nigerian economy, as it will lead to reduced transportation costs and lower prices for goods and services. This is a welcome development, especially for small businesses and individuals who have been struggling with the high cost of living. The Nigerian government has been working to improve the country’s economy, and this move by Dangote Refinery is a significant step in the right direction.
Dangote Refinery’s latest price reduction reinforces its role in reshaping Nigeria’s energy economy. For many, it symbolizes a step toward self-sufficiency – a future where Nigerians can rely on locally refined fuel at sustainable prices. The refinery’s commitment to price stability is commendable, and it is expected that other marketers will follow suit to maintain market share.
