Aliko Dangote, world’s richest black man and owner of the $20 billion Dangote Refinery, has revealed the reasons behind the recent drop in fuel prices in Nigeria after a year of consistent increases.
Market Forces Behind the Price Reduction
In an interview with Arise TV, Dangote explained that the decrease in petrol prices is driven by market forces and competition, rather than deliberate actions by marketers to ease the financial burden of the festive season.
“The price reduction is a response to the market,” Dangote said. “We invested over $20 billion in the refinery, and we have to protect our interests and our investments.”
New Petrol Prices Announced
On 19 December 2024, the Dangote Refinery lowered the ex-depot price of petrol to N899.50 per litre. This triggered competitive pricing across the industry, with the Nigerian National Petroleum Company Limited (NNPCL) reducing its price to N899 per litre.
Additionally, Dangote Refinery partnered with MRS fuel stations to offer petrol at N935 per litre nationwide, bringing relief to commuters during the busy holiday season.
Impact on Nigeria’s Economy
Dangote highlighted the strain petroleum imports place on Nigeria’s foreign exchange reserves. He noted that about 40% of foreign exchange demand comes from importing fuel, which drains the country’s reserves.
“The more we import petroleum products, the more foreign exchange we send out of the country,” he explained. “This is not sustainable for our economy.”
Special Holiday Offer
To ease transport costs during the festive season, the refinery introduced a special discount. Petrol was made available at N899.50 per litre at its truck loading gantry. Customers paying in cash also received an opportunity to purchase additional litres on credit, backed by guarantees from Access Bank, First Bank, or Zenith Bank.
Dangote Refinery’s Role in Nigeria’s Energy Needs
The Dangote Refinery is the world’s largest single-train refinery, capable of producing 650,000 barrels of petroleum daily. It aims to meet Nigeria’s entire fuel demand while also generating surplus for export.
This move underscores the refinery’s importance in stabilising fuel prices and reducing the nation’s reliance on imports.