Dangote-backed marketers cut petrol to N1,264 per litre as competition heats up

Marketers operating under the Dangote Petroleum Refinery consortium have cut petrol prices to as low as N1,264 per litre. Ardova and Aiteo are offering Premium Motor Spirit at N1,264 per litre, while NIPCO is selling at N1,265 per litre.

The reductions follow changes to Dangote Refinery's trading structure, which gives participating marketers more flexibility to set prices. The shift is intensifying competition among the refinery's 37 consortium members and putting pressure on independent depot operators.

Price gap and margins

Market information shows the marginal difference between Ardova, Aiteo and NIPCO reflects competition for larger shares of Nigeria's petrol distribution market. Industry sources said some participating marketers currently enjoy a difference of about N50 per litre between their purchase and resale prices. That margin gives room for price adjustments, though actual profitability depends on transport, financing and other operating costs.

An industry source familiar with the arrangement said Dangote Refinery's revised trading model uses the European gasoline benchmark, EBOB, alongside an agreed premium. EBOB, also known as Eurobob, is a widely used benchmark for gasoline blendstock traded in European physical and derivatives markets. Petrol prices are linked to the benchmark, with additional premiums set by commercial agreements. Exchange rates and other applicable costs can also influence the final selling price.

Depot pressure

The source said the revised structure lets consortium members respond faster to market conditions instead of holding uniform selling prices. The price cuts are also affecting independent depot operators, who must compete with Dangote-backed marketers for customers. The refinery recently reviewed its petrol prices downward, triggering reductions of up to N10 per litre across some depots within a single day. The move has increased pressure on other suppliers to adjust or risk losing customers to cheaper competitors.

Marketers' ability to reduce prices still depends on acquisition costs, existing inventories and operational expenses. Lower depot prices do not automatically translate into immediate savings at filling stations. Retail pump prices also reflect transportation costs, distribution margins and individual marketers' pricing decisions.

What it means

Sustained competition could eventually benefit motorists, transport operators and businesses that depend heavily on petrol. For now, the N1,264 per litre offer highlights the growing influence of Dangote Refinery's supply network on Nigeria's downstream market. The path of future reductions will depend on refinery pricing decisions, international gasoline benchmarks and prevailing market conditions.

Separately, compressed natural gas prices range between N380 and N500 per standard cubic metre, according to figures from the Major Energies Marketers Association of Nigeria. That offers motorists an alternative as concerns over petrol affordability persist.