Oil Marketers
By Olamilekan Abayomi
A price war is heating up in Nigeria’s petroleum sector, with some retailers dropping the price of Premium Motor Spirit (PMS) below Dangote Refinery’s recommended N739 per litre. NIPCO is selling at N738 per litre, SAO at N735, and Akiavic at N737, while an AP station in Mowe, Ogun State, is offering it at N736 per litre.
This price cut comes after Dangote Refinery reduced its gantry price from N828 to N699 per litre in December, sparking intense competition among marketers. Many retailers are selling below cost to remain competitive, with some offering discounts of up to N100 per litre .
The Major Energies Marketers Association of Nigeria says the landing cost of petrol averages N762.38 per litre, while Dangote’s ex-gantry price is N699. Despite this, importers are adjusting prices to compete with Dangote-backed MRS .
Dangote had warned marketers against keeping pump prices high, vowing to enforce the new pricing regime. The refinery is determined to ensure petrol sells for no more than N740 per litre nationwide during December and January.
The price war is driven by market dynamics, with filling stations closely monitoring competitors’ prices. Motorists are flocking to the cheapest pumps, leaving higher-priced outlets struggling for customers.
The Nigerian National Petroleum Company Limited has also reduced petrol prices from N875 to between N825 and N840 per litre, depending on location. However, with a landing cost of around N828 per litre, importers face significant losses competing with Dangote’s N699 ex-depot price.
Industry estimates suggest petrol importers could lose up to N102.48 billion monthly, while Dangote Refinery may lose about N91 billion due to aggressive pricing.
The Independent Petroleum Marketers Association of Nigeria confirms price competition now determines customer loyalty. Marketers unwilling to adjust prices risk losing patronage and facing mounting bank interest costs.The price war is expected to continue, with consumers emerging as the immediate beneficiaries.
