Global oil prices fell sharply on Wednesday, declining by over 11 percent amid growing expectations of a diplomatic breakthrough between the United States and Iran, even as Dangote Petroleum Refinery maintained its petrol gantry price at ₦1,275 per litre.
As of 12:30 p.m. WAT, Brent crude dropped by 11.05 per cent to $97.73 per barrel, while West Texas Intermediate (WTI) fell by 11.95 per cent to $90.05 per barrel, reflecting a broad market correction driven by easing geopolitical risk premiums.
The decline followed reports that both countries are considering a preliminary agreement to pause hostilities and create a framework for further negotiations. This has shifted market sentiment, with traders increasingly pricing in reduced risks of supply disruptions from the Strait of Hormuz, a critical global oil transit route.
Despite the sharp fall in crude prices, Dangote Refinery held its Premium Motor Spirit (PMS) ex-depot price steady at ₦1,275 per litre, signalling a lag between international oil price movements and domestic petrol pricing.
Market data from Petroleumprice.ng indicates that the refinery maintained this pricing level at the loading gantry, even as global benchmarks weakened significantly.
Industry operators note that under typical market conditions, a drop of this magnitude in crude oil prices would be expected to trigger a downward adjustment in depot and retail petrol prices. However, such adjustments often depend on broader factors, including existing inventory costs, exchange rate dynamics, and supply chain considerations.
The current pricing stance has, however, helped stabilise short-term market expectations, particularly among downstream marketers who had been positioning for volatility in depot prices.
In the international market, analysts attribute the steep decline to a rapid shift in sentiment as geopolitical tensions appeared to ease. Iran has indicated openness to negotiations, with Abbas Araghchi emphasising that any agreement must be balanced and protect national interests.
Earlier tensions had escalated following the launch of “Project Freedom” by Donald Trump, aimed at escorting vessels through the Strait of Hormuz. The operation was later paused amid signs of diplomatic progress, reinforcing expectations of a possible resolution.
While uncertainty remains and no formal agreement has been reached, the divergence between falling global oil prices and stable domestic petrol pricing highlights the complexities of Nigeria’s downstream market, where price adjustments do not always immediately mirror movements in international crude benchmarks.