Dangote Refinery’s Price Boost Drives Petrol To Unprecedented Price Hike

Dangote Refinery’s Price Boost Drives Petrol To Unprecedented Price Hike

The price of Premium Motor Spirit (PMS), commonly known as petrol, has surged to between N1,050 and N1,150 per litre, depending on the location, following a price hike implemented by the Dangote Petroleum Refinery and other depot…Dangote Refinery’s Price Boost Drives Petrol To Unprecedented N1,150

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Petrol dealers confirmed that the rise in prices is set to continue, as crude oil prices have been on an upward trajectory recently.

Festus Osifo, National President of the Petroleum and Natural Gas Senior Staff Association of Nigeria, had earlier warned that petrol prices were likely to increase further if crude oil prices continued to rise. “Crude oil prices have reached $80 per barrel. Without improvements in exchange rates, the cost of petrol will rise in the coming weeks,” Osifo said in Lagos.

On Friday, the Dangote Refinery adjusted the price of petrol from N899 per litre to N955 per litre at its loading gantry. This hike follows the refinery’s holiday discount in December, marking a rise of N55.5 (a 6.17% increase).

The price adjustment applies to stocks that have not been lifted by the new price effective from 5:30 pm on Friday. The refinery’s statement explained that bulk buyers purchasing between two million and 4.99 million litres would now pay N955 per litre, while those buying five million litres or more would pay N950 per litre.

This price increase has led to ripple effects across the petroleum sector. Private depots, even with older stock, raised their prices to N970 per litre in Lagos and N1,000 in Calabar. Depots like Sahara, Pinnacle, Wosbab, and NIPCO increased their prices, with NIPCO rising by N30 to N980 per litre.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) projects that retail petrol prices could soon reach N1,100 per litre in Lagos and surrounding states, while customers in the Federal Capital Territory may face prices as high as N1,150 per litre.

Chinedu Ukadike, IPMAN National Publicity Secretary, emphasized that these price increases are directly linked to the rise in global crude oil prices. “Once crude oil prices rise, domestic production costs also increase. Marketers and retailers are adjusting prices to reflect these changes,” he explained.

Retailers are feeling the impact, with many unable to sell petrol at N1,000 per litre and still cover their costs. According to the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), the current margin for retailers will be higher than N45.

Oil and gas experts like Olatide Jeremiah suggest that the influence of the Dangote refinery on fuel prices is significant. “Private depots, major marketers, and independent marketers will have to adjust their prices to compete with Dangote’s pricing, leading to higher pump prices for Nigerians,” he said.

The increase in global crude oil prices, which reached $81.84 per barrel as of Friday, is a major contributor to the rising cost of petrol, further complicating the nation’s fuel pricing dynamics.

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