Dangote Refinery may slash fuel prices again as depot competition tightens

Dangote Petroleum Refinery is reviewing its fuel pricing strategy after a fresh decline in depot prices and rising competition in Nigeria's downstream oil market. Industry sources say the refinery may adjust its ex-depot prices for petrol and diesel, though no official announcement has been made.

Motorists and businesses could see another reduction in pump prices if the review leads to a cut. Stakeholders believe the move is under active consideration as global crude oil prices soften and private depots undercut Dangote's diesel rate.

Price review under consideration

The review comes as global crude oil prices continue to ease. As of Monday morning, Brent crude traded at $85.81 per barrel, while U.S. West Texas Intermediate stood at $81.89 per barrel. Lower crude prices reduce the cost of refining fuel, creating room for refiners to lower wholesale prices.

Analysts say this trend, combined with increasing competition among depot operators, has strengthened expectations of another downward adjustment. Dangote Refinery is the country's largest refinery, and its pricing decisions often influence the wider downstream market.

Diesel prices fall below Dangote rate

Competition in the diesel market has become particularly fierce. According to market checks by Petroleumprice.ng, several private depots in Lagos are already selling Automotive Gas Oil below Dangote Refinery's current ex-depot price.

Integrated, Ibeto, T.Time, Duport, Ibachem, Gulf Treasure, African Terminal and Pivot all quoted diesel at ₦1,620 per litre on Monday. Emadeb sold at ₦1,630 per litre, while Wosbab reduced its price from ₦1,630 to ₦1,620 per litre. TMDK also lowered its diesel price to ₦1,620 per litre, while Prudent in Warri offered the product at ₦1,650 per litre.

The aggressive pricing by private depots has narrowed the gap with Dangote Refinery, increasing pressure on the refinery to remain competitive.

Petrol depots match Dangote rate

The petrol market is showing similar trends, with depot prices across the country now closely matching Dangote Refinery's current ex-depot rate. In Lagos, Aiteo reviewed its petrol price to ₦1,215 per litre, while Emadeb and Ardova sold at ₦1,217 per litre. MRS Tin Can quoted ₦1,218 per litre.

Outside Lagos, Liquid Bulk in Port Harcourt sold petrol at ₦1,220 per litre, Matrix offered ₦1,222 per litre, while Hong Petroleum, Mainland and Sobaz in Calabar quoted prices ranging from ₦1,217 to ₦1,218 per litre. The narrowing price difference shows competition among marketers is intensifying as companies seek to attract bulk buyers.

What it means for consumers

If Dangote Refinery announces a price cut, consumers could benefit from lower pump prices in the coming days. Marketers may be forced to further reduce rates to remain competitive, reinforcing the price competition that has come to define Nigeria's liberalised fuel market.

This development could offer relief to households and businesses grappling with high transportation and energy costs.