Dangote Petroleum Refinery adopts dollar pricing for petrol, diesel and aviation fuel, signalling a major shift in Nigeria’s downstream oil market
Dangote Petroleum Refinery has ended naira-denominated sales of refined petroleum products, introducing a dollar-based pricing regime that fixes the ex-depot price of Premium Motor Spirit at $0.779 per litre and reshapes the commercial framework for Nigeria’s downstream petroleum market.
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The Dangote Refinery Dollar Pricing policy, which took effect on Monday, also sets Automotive Gas Oil (diesel) at $1.087 per litre, aviation fuel at $0.942 per litre, and coastal deliveries of petrol at $1,044.62 per metric tonne, marking one of the refinery’s most significant commercial policy changes since commencing operations.
In a notice issued to petroleum marketers and customers, the refinery announced that all previously issued naira-denominated Proforma Invoices and Deal Recaps for gantry and coastal transactions had become invalid following the transition to United States dollar transactions.
The notice, signed by the refinery’s Group Commercial Operations, stated: “Following our email of July 9, 2026, regarding the transition from naira to United States dollars (USD), please note that all issued naira coastal and gantry PFIs/Deal Recaps are now invalid, and no payments should be made against them.
“The applicable USD prices for each product, effective today, July 13, 2026, are provided below.”
Under the revised schedule, Liquefied Petroleum Gas remains exempt from the new policy.
“Also note that this transition to USD does not apply to LPG transactions,” the refinery said.
The decision brings to an end the refinery’s participation in naira-based product sales, which began under the Federal Government’s naira-for-crude initiative introduced on October 1, 2024.
The policy was designed to strengthen domestic refining, reduce pressure on Nigeria’s foreign exchange reserves and stabilise fuel prices by allowing local refiners to purchase crude oil in naira.
Industry sources familiar with the development said the refinery adopted the new pricing framework after an increasing mismatch emerged between the currency used to purchase crude oil and the currency used to sell refined products.
According to one source, Dangote Refinery now receives a substantially larger proportion of its crude oil supplies from the Nigerian National Petroleum Company Limited under dollar-denominated arrangements, while a significant share of its petroleum products has continued to be sold domestically in naira.
“The resulting currency mismatch, combined with volatility in international crude oil prices and continued exchange-rate uncertainty, made it necessary to migrate product sales to dollars,” another source explained.
The transition is expected to have far-reaching implications for petroleum marketers, many of whom rely on Dangote Refinery as their primary supplier.
Because the refinery has become Nigeria’s largest producer of refined petroleum products, its pricing decisions increasingly influence market trends across the deregulated downstream sector.
While the refinery has now established a dollar benchmark for wholesale purchases, the retail pump price paid by motorists will continue to depend on several factors, including the prevailing naira-to-dollar exchange rate, transportation and logistics costs, regulatory charges and marketers’ operating margins.
The policy shift also raises fresh questions about the long-term viability of the Federal Government’s naira-for-crude programme, which has encountered implementation challenges in recent months amid reports that a growing proportion of crude supplies to local refiners has reverted to dollar-based transactions.
Analysts say the development highlights the significant foreign exchange pressures still confronting Nigeria’s energy sector despite increased domestic refining capacity.
Although Dangote Refinery has substantially reduced the country’s dependence on imported petrol, fluctuations in crude oil prices and exchange rates continue to play a central role in determining fuel costs.
In recent months, pump prices have moved in line with changes in global oil markets, foreign exchange conditions and competition among suppliers.
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With Dangote Refinery accounting for an increasingly large share of domestic fuel supply, industry stakeholders are expected to monitor closely how the new dollar-denominated pricing framework affects wholesale costs, retail prices and the broader downstream petroleum market.
David Okere is a journalist and contributor to Freelanews.com, covering business, governance, public affairs, and human-interest stories with a commitment to accuracy, balance, and public interest reporting.
