The price war in the downstream oil sector intensified on Tuesday as major oil marketers moved to offer a lower price against the gantry loading cost of N825 per litre set by Dangote Petroleum Refinery.
This development followed a revelation by marketers that the landing cost of Motor Spirit (petrol) imported into Nigeria has dropped to N774.72 per litre. Marketers said the continued price plunge may lead to a reduction in the pump prices of PMS to about N800 per litre.
Dealers said the N774.72 per litre landing cost, which factors in various expenses including shipping, import duties, and exchange rates, is a considerable reduction of N50.28 from the N825 per litre offered at the loading gantry of the Dangote Petroleum Refinery.
The situation, according to industry stakeholders, has ignited a price war, with retail marketers now opting to dump the refinery products for imported products on the basis of lower pricing.
Findings by The PUNCH also revealed that this decrease in landing cost is expected to influence the price at which petrol is sold to consumers and could increase marketers’ interest in returning to petrol imports.
“Crude oil is a major component in the production of fuel, so a further reduction in its price would definitely warrant a drop in petrol price, and it is possible to drop to N800 per litre,” the National Publicity Secretary of the Independent Marketers Association of Nigeria, Chief Ukadike Chinedu, stated.
Recall that last Monday, NNPC dropped its retail petrol price to N860 and N880 per litre from N945 and N965 in Lagos and Abuja, respectively.
NNPC’s petrol price drop followed Dangote refinery’s retail fuel price reduction to N860 and N880 per litre across its retail partners.
The refinery, in its second price reduction in the new year and the third one in a space of two months, reduced its ex-depot petrol price from N890 to N825 per litre to the delight of Nigerians.
But the reduction by NNPC, the country’s largest fuel supplier, sparked a wave of competitive pricing among private marketers seeking to capture the market share in an environment where consumers are highly sensitive to price fluctuations.
The pain of the price reduction was more significant for petrol importers as they lost an average of N2.5bn daily and N75bn monthly due to the PMS price reduction.
But in a swift business survival strategy, these marketers have now secured fresh products at a cheaper cost that is now detrimental to the operations of the refinery.
According to the latest competency centre daily energy data released by the Major Energies Marketers Association of Nigeria and obtained by our correspondent on Tuesday, the on-spot estimated import parity into tanks has reduced to N774.82 per litre, a reduction of N152.56 or 16.5 per cent from the N927.48 per litre quoted on February 21, 2025 (the last energy data on petrol).
The average cost for 30 days also dropped to N864.92 per litre, while on-the-spot sale at the NPSC terminal was N927.53.
The document also noted that the price of Brent crude was benchmarked at $70.36 per barrel, down from $76.48 per barrel quoted on February 21, with an exchange rate of N1,517.24 per dollar. This price was calculated based on 38,000 metric tonnes by the marketers.
This cost is viewed as an improvement for importers, providing private depot owners and independent marketers with an alternative route to profitability and the opportunity to source cheaper products
Further checks by our correspondent revealed that private depots have effected a price change lower than marketers off taking products from the refinery.
An analysis showed that AA RANO depot has reduced its loading cost to N830 per litre, MENJ Depot now sells at N830, MRS TINCAN sold its products at N830, WOSBAB gave its customers a price estimate of N832, AITEO gave a price of N832 and RAINOIL depot sold its products at N831 per litre.
While marketers that bought two million litres from the Dangote refinery at N825 are selling at N835 per litre, indicating an N1 profit and N4 less than the price offered by private depots.
Commenting on the latest development, an oil and gas expert, Olatide Jeremiah, forecasted that the current situation is likely to compel the refinery to lower its ex-gantry price to attract more customers.
Jeremiah, who is the Chief Executive Officer of petroleumprice.ng, emphasized that, due to ongoing price fluctuations, marketers are increasingly choosing to source products from private depots, where they can expect greater price stability. This shift in preference is because the refinery has implemented two price reductions this year.
Giving a detailed explanation of the situation, he stated, “Last week, prices particularly for petrol and diesel started dropping, and on Thursday, it went below Dangote’s ex-depot price. The refinery price is N825 per litre and marketers will pay N9 for NMDPRA fees and other levies making a total of N834 per liter.
“Even as I speak, marketers that bought from Dangote and still have old stock are seeking at zero profit. So most of the marketers stopped buying. Many depots also started selling N830, even MRS, that get products from Dangote, while marketers at the Dangote refinery sold between N835 or N834 today to finish their stock.
“Other private depots are selling at N830 or N831 per liter. The reason is that private depots got a cheaper product even less than Dangote coastal price of N780. But the landing cost is less than that amount. Another scenario is the MRS and Ardova got their product at the coastal price which will enable them to sell at N834.
“The expense to the truck from Dangote refinery is between N40 to N45, so it is not a good deal. I can tell you at the Dangote depot today, the place was deserted, marketers trading there have now switched to private depots. This is likely to force Dangote to reduce its price.
“Rumours are already spreading because private depots are now making good sales. The back and forth of prices has made marketers uncomfortable. They are counting their loss and that is why they now patronise private depots where there is a bit of stability.”
On Monday, oil marketers under the aegis of the Petroleum Products Retail Outlet Owners Association of Nigeria condemned the constant reduction of fuel prices, saying marketers are still counting losses.
Despite deregulation, PETROAN said there is a need for a regulation that will make it mandatory that prices can only be changed after six months.
In a statement by PETROAN Publicity Secretary Joseph Obele, the association also made a U-turn, saying imports should be encouraged to put an end to monopoly.
Better don't reduce your fuel below what would give you profit, all this imported fuel could be stolen crude refined or cheaply blended ... What is important is for the regulator to stop this importations before it creepies Nigeria Economy ..
Even if the price drops to N700/Ltr, these transporters will still not drop their fare. If government deh do us, we citizens deh do ourselves too. An Average Nigerian is corrupt and always looking for opportunity fleece his fellow citizen.
Babangidapikin:
Better don't reduce your fuel below what would give you profit, all this imported fuel could be stolen crude refined or cheaply blended ... What is important is for the regulator to stop this importations before it creepies Nigeria Economy ..
Abeg shut up. It's not by force to comment.
What is happening is result of supply and demand and the effect of the free market in the downstream sector. No business man will do business at a loss. The price reduction will keep happening so far global crude oil price keep crashing and these importers and Dangote still have room to wiggle with respect to profit.
Elemi lo ma last. Meaning "only the strong will survive".
When Tinubu said something to that effect last year during his media chat, he knew what he was saying. But as always, majority failed to pay attention (like they always do) to concentrate on irrelevant stuff.
And what do you mean by "What is important is for the regulator to stop this importations before it creepies Nigeria Economy"
Lmaoooo. It's either you are slow or you doing the dirty work for Dangote. Lol. So we should stop importation of PMS so Dangote can roam free to fleece Nigerians like he does with his cement business and how our local farmers r@aped us for years?
I suspect NNPC will be slow to renew naira for crude deal so they can deal with Dangote.
Did you see that nothing change yet in the money we spend on importing fuel?
Where are these fuel going to? The corruption has not stopped
D game was to make prices go up and reverse it to gain cheap praises from party loyalists.
We are waiting for him to crash the prices. Surely the brilliant Chicago ant will succeed where Buhari failed on this matter of crashing petrol price.
Do you think he will crash it to N40 that Prof. Tam David West told us Buhari was capable of achieving 10 years ago
Deltafirstson:
Although the pump price of fuel was N197 when President Bola Tinubu took over on May 29, 2023, the product now sells for N617 per litre – less than two months after.
In his inaugural address, Tinubu announced that subsidy was gone, fulfilling a promise that all leading presidential candidates made during the campaign.
However, pump price of fuel hit N537 per litre days after Tinubu ended subsidy.
On Tuesday, the price climbed further to N617, a development that the Nigerian National Petroleum Corporation Limited (NNPCL) attributed to “market forces”.
Nigerians have been lamenting the hardship occasioned by fuel price hike. Amid the lamentation, a video where Tinubu campaigned to slash the price of fuel went into circulation.
Checks by Daily Trust affirmed the authenticity of the video ed on the YouTube page of Channels Television.
At his campaign rally in Abeokuta, Ogun State capital, on January 25, 2023, Tinubu spoke on a number of issues, but those of fuel scarcity and naira redesign made the headlines.
However, Tinubu who spoke in Yoruba language, also assured the crowd that though people were saying petrol price would hit N200, it would be reviewed downward under him.
“The great Nigerian youths, the great Nigerian students, the confident Nigerian youths. This is a revolution. This election is a revolution. They are plotting, but they will fail. They said fuel price will increase and reach N200 per litre. Go and relax, we will bring it down,” he had said in the 7th minute of the video.
King Wasiu Ayinde Marshall, a Fuji musician who performed at the rally, interrupted the president’s speech with chants as the crowd cheered.
On the campaign podium with the president were Vice-President Kashim Shettima; Pa Bisi Akande, interim National Chairman of the APC; Femi Gbajabiamila, Chief of Staff to the President; Senator Gbenga Daniel; among other bigwigs of the ruling party.
Tinubu went further to say Nigerians would defy the acute fuel scarcity at the time and trek to cast their votes.
“The great Nigerian youths, the great Nigerian students, the confident Nigerian youths. This is a revolution. This election is a revolution. They are plotting, but they will fail. They said fuel price will increase and reach N200/N500 per litre. Go and relax, we will crash the prices,” he had said.
I suspect NNPC will be slow to renew naira for crude deal so they can deal with Dangote.
Did you see that nothing change yet in the money we spend on importing fuel?
Where are these fuel going to? The corruption has not stopped
Thats why they need to play mind games with us by associating N774 with a litre of imported fuel. Ask them where is the fuel and you will hear stories.
tollyboy5:
I suspect NNPC will be slow to renew naira for crude deal so they can deal with Dangote.
Did you see that nothing change yet in the money we spend on importing fuel?
Where are these fuel going to? The corruption has not stopped
Corruption under APC is worse than under PDP, which is not surprising seeing that Abacha's PTF associate led looted us for eight years before handing over to ebilokan to continue with his Lagos master plan for raising revenue and borrowing to do nothing with it for 20 million Lagosians.
socialmediaman:
The 2018 Rating by Transparency International placed Nigeria at 148th position out of 180 countries. Nigeria was improving over the years under the previous government, until Buhari got elected as president, things became worse.
There is a difference between fact and fiction. We need to face facts, Buhari is worse than GEJ when it comes to fighting corruption, at least that’s what the facts prove.
Most of us believed there was corruption under Goodluck Jonathan’s Government. I agree with those who did, there was corruption, but not as bad as it is today under Mohammadu Buhari.
In 2012, Nigeria was placed at 139th position, In 2014, Nigeria gained 3 steps and was placed at 136th position. Under Buhari, Nigeria has lost many positions down to 148th.
There’s no further proof needed that corruption has worsened under Buhari’s government compared to previous years.
mrvitalis: NNPC should tell us where they import at 774 per litre na
We should import billions and sale to Ghana Togo Benin, Cameron, ivory cost even Niger at ₦1350... They would be more than happy to buy
Bunch of lies expects
Dont mind the Cabal. They all own businesses built around fuel subsidy. Their salary cannot buy recharge card and data. Thats what they eat with.
confusion don dey enter their midst
