Dangote Refinery’s decision to reduce the ex-depot price of petrol from N950 to N890 per litre has sparked mixed reactions among marketers, with some fearing losses
[dropcap]I[/dropcap]n a bold move aimed at providing economic relief, the Dangote Petroleum Refinery announced a significant reduction in the ex-depot price of Premium Motor Spirit (PMS), commonly known as petrol, from N950 to N890 per litre.
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The price adjustment, which took effect on the night of Saturday, February 2, 2025, was in response to favourable global developments and a decrease in international crude oil prices.
The refinery’s decision is expected to lower the cost of petrol across Nigeria, benefiting consumers and the broader economy.
Dangote’s Group Chief Branding and Communications Officer, Anthony Chiejina, explained that the reduction reflects the refinery’s commitment to market realities and ensuring consumers benefit from changes in international crude oil prices.
The refinery has urged marketers to pass on the reduced price to the public.
However, the sudden price reduction has put many petroleum marketers in a difficult position. Some marketers, having purchased petrol at the higher price of N950 before the announcement, are now forced to sell at a loss.
Independent Petroleum Marketers Association of Nigeria (IPMAN) Vice President, Hammed Fashola, highlighted the challenges faced by marketers, noting that they would be forced to lower prices to remain competitive.
He explained that not doing so would leave them unable to sell their stocks, resulting in financial losses.
Despite the negative impacts on some businesses, Fashola acknowledged the broader benefits for the public. He described the move as part of the beauty of deregulation, with competition ultimately leading to lower fuel costs for consumers.
Marketers were also reminded to be strategic in their purchasing decisions to avoid unnecessary losses.
The reduction is seen as a response to concerns raised by importers, who had complained that imported PMS was cheaper than locally refined products.
The reduction by Dangote refinery ensures that the price of domestically refined fuel remains competitive, providing a positive ripple effect on the sector.
Billy Gillis-Harry, the National President of the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), praised the Dangote refinery’s decision, noting that it would reduce the cost of living and transportation in Nigeria.
The price reduction is expected to lower inflation and drive economic growth by facilitating more efficient transport of goods and services across the country.
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While some marketers are concerned about the short-term financial impact of the price reduction, others remain optimistic that competition in the sector will eventually benefit consumers and the economy.
