Hope Rises for Cheaper Petrol as Brent Crude Drops Below $84
By Aboki Forex —
Brent crude fell more than 4.8% to about $83.70 per barrel on Monday, raising cautious expectations that petrol prices in Nigeria may ease if the decline holds. The selloff followed US President Donald Trump's announcement that a planned military strike against Iran had been suspended for continued diplomatic talks.
US West Texas Intermediate also dropped over 5% to around $79.60 per barrel. Under Nigeria's deregulated downstream oil sector, pump prices are shaped by international crude costs, the naira-dollar exchange rate, freight charges, and domestic distribution expenses. A sustained drop in global crude prices generally reduces what importers and marketers pay for refined products, which can eventually filter through to consumers.
Marketers May Delay Price Cuts
Industry operators warn that any reduction at the pump will not happen overnight. Many fuel marketers are currently selling petrol bought when international prices were considerably higher, and they are unlikely to cut prices until they have worked through that stock. The naira's performance, transportation logistics, and taxes will continue to shape the final price, regardless of where crude trades internationally.
For Nigeria's government, cheaper crude carries its own risks. Lower oil prices typically shrink export earnings and reduce the foreign exchange inflows the country relies on to support public spending.
Depot Prices Begin to Shift
On Tuesday, August 4, depots across Nigeria made little changes to their petrol prices as they monitored the global oil market. Data from Petroleumprice.ng showed PMS prices ranged from N1,215 to N1,225 per litre across major depots. This is a reduction from the average price of N1,300.
Dangote, Aiteo and Pinnacle sold at N1,215 per litre. African Terminal, Ardova, Integrated, and Nipco sold at N1,216 per litre. Liquid Bulk and Sigmund quoted N1,217 per litre. Lister, MRS, Mainland, Sobaz, and Soroman sold at N1,218 per litre. Matrix and Northwest were at N1,220 per litre. A.Y.M Shafa quoted N1,223 per litre. Nepal, Optima, and Rain Oil had the highest price at N1,225 per litre.
Dangote and NNPC Adjust Prices
Previously, the Nigerian National Petroleum Company Limited lowered petrol prices at its retail stations following a reduction in the ex-depot price by Dangote Refinery. Dangote cut its gantry price by N85, from N1,285 to N1,200 per litre. NNPC retail outlets then reduced their pump price by N75, with petrol selling at N1,255 per litre instead of N1,330.
Analysts believe Dangote is preparing another price reduction, which could trigger a new round of price changes. For Nigerian consumers, any sustained drop in crude prices could eventually bring relief at the pump, but how quickly that happens depends on stock clearing, exchange rate stability, and distribution costs.