Dangote Refinery, once celebrated for its competitive fuel prices, is facing stiff competition from cheaper imported petrol. This shift has led many oil marketers to choose imported products over locally refined ones, posing a challenge to Nigeria’s goal of fuel self-sufficiency.
Why Marketers Are Choosing Imported Petrol
The landing cost of imported Premium Motor Spirit (PMS) has dropped to ₦922.65 per litre, which is ₦32.35 cheaper than the Dangote Refinery’s loading price of ₦955 per litre.
According to industry data, marketers imported 76.84 million litres of petrol in just two days, highlighting the growing preference for imports.
One marketer explained, “The lower cost of imported petrol is an attractive option for us. It’s not about disloyalty to local products, but about managing costs and offering competitive prices.”
Impact on Consumers and Prices
Consumers might hope for a drop in pump prices as import costs decline. However, depot prices remain high, ranging between ₦950 and ₦990 per litre across major locations. This disparity raises questions about when, or if, these cost savings will reach everyday Nigerians.
Dangote Refinery Faces Tough Competition
The Dangote Refinery, which was expected to dominate the market with affordable locally refined fuel, is now struggling to match the prices of imported alternatives. While the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) had earlier pushed for a 180-day ban on imports to support local refining, the current cost differences have made imports more appealing.
What This Means for Nigeria
The shift towards imported fuel highlights ongoing challenges in the country’s refining sector. Without competitive pricing, achieving fuel self-sufficiency through local production will remain a significant hurdle.
For now, marketers are prioritising profits and cost efficiency, leaving consumers and the Dangote Refinery to navigate an increasingly competitive fuel market.