Game-Changer! NNPCL And Dangote Fuel Price Cuts Leave Marketers Scrambling

Game-Changer! NNPCL And Dangote Fuel Price Cuts Leave Marketers Scrambling

A wave of competition shook Nigeria’s downstream sector on Saturday as the Nigerian National Petroleum Corporation Limited (NNPCL) announced a reduction in its ex-depot price of Premium Motor Spirit (PMS), commonly known as petrol,….Game-Changer! NNPCL And Dangote Fuel Price Cuts Leave Marketers Scrambling

to N899 per litre.

This price cut, which came shortly after the Dangote Refinery also lowered its price to N899, was confirmed by the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN). The new rate represents a decrease of N141, or 13.56%, from the previous selling price of N1,040 per litre in Abuja.

According to a statement by the association’s National Public Relations Officer, Dr. Joseph Obele, this move is part of a wider pricing shift in response to the deregulated downstream sector. Marketers will now purchase petrol at varying regional rates, with Lagos prices set at N899 per litre and prices in other regions like Warri and Calabar at N970 per litre.

NNPCL’s price cut is seen as a direct response to the effects of deregulation, which has created heightened competition within the sector. However, NNPCL’s spokesperson, Olufemi Soneye, declined to comment on the decision.

Marketers Expect Further Price Drop

Obele expressed optimism that PMS prices could continue to decline before January 2025, driven by falling global crude prices and the strengthening of the naira. He referred to the price reduction as part of a broader “price war” that would ultimately benefit consumers. He also urged for the privatization of state-owned refineries to further improve the sector’s competitiveness.

According to the National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Abubakar Maigandi, once marketers begin purchasing at the new rate, the benefits will be passed on to consumers. “Once we start buying fuel at this reduced price, we will reflect this in our own pricing as well,” he said.

Chinedu Ukadike, IPMAN’s National Publicity Secretary, lauded the price cut, attributing it to healthy competition from deregulation and a more favorable foreign exchange rate. He added that although there won’t be a uniform price across all filling stations, prices will likely not exceed N1000 per litre, except in remote Northern areas where logistics costs are high.

Economic Impact of Lower Fuel Prices

PETROAN’s National President, Billy Harry, also praised the price cut, noting its potential to bring relief to motorists and businesses. He emphasized the broader economic benefits, such as reduced transportation costs, stimulation of economic activity, and improved living standards for Nigerians.

Harry also acknowledged Dangote Refinery’s earlier price reduction, which sparked competitive pressure in the sector, ensuring consumers benefit from affordable fuel.

Dangote Refinery’s Partnership with MRS

Meanwhile, Dangote Industries President Aliko Dangote commended President Bola Tinubu’s naira-for-crude swap deal, which he credited for the recent reductions in petrol prices. Dangote announced a partnership with MRS Petroleum to sell petrol at N935 per litre across the country, following a price reduction at its refinery to N899.50.

Dangote’s partnership with MRS will ensure that these price reductions reach consumers at retail stations. The new prices are set to take effect in Lagos from Monday and will spread nationwide shortly thereafter.

In his statement, Dangote called on other oil marketers, including NNPC Retail, to join efforts in ensuring that Nigerians enjoy high-quality petrol at lower prices.

The reduction follows the Federal Executive Council’s approval in September of a naira-based crude-for-petrol transaction, which has alleviated pressure on the dollar and contributed to local currency stability.

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