Fuel Marketers Fear High Petrol Prices from Dangote Refinery Amid Rising Landing Costs
Oil marketers are expressing concerns over the delay in announcing the price of Premium Motor Spirit (PMS), popularly known as petrol, from the Dangote Petroleum Refinery.
This comes as the landing cost of imported PMS has risen to around N1,120/litre, sparking fears that a high price from Dangote could lead to increased importation of petrol.
“We are waiting for our foreign partners to calculate how much it will cost to bring the product to Nigeria,” said Abubakar Maigandi, National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN). “So, we are waiting to get the data from them.
If the landing cost is cheaper than what the Dangote refinery will sell, then we will see how to bring in the product.”
Maigandi emphasized that allowing multiple importers would ensure availability and competition in the market.
“One advantage of allowing everyone to bring in the product is that there will be guaranteed availability of products.
There is also going to be competition.
Once this happens, everybody will try to see how they can sell their products and buy another one.
It is only when you sell what you have that you can generate profit.”
An official of the Dangote Group, who preferred to remain anonymous, stated that the company’s president, Alhaji Aliko Dangote, is committed to making sacrifices for the sake of the masses.
“We will do everything possible to beat down the price of petrol. We will sell PMS in Nigeria whether or not the NNPC agrees to be its off-taker or not.”
The official recalled how the refinery brought down the price of diesel from about N1,600 to N950 before it started hovering around N1,100 and N1,200 due to foreign exchange fluctuations.
“When we started diesel, the product was around N1,700. We crashed the price to N1,200 and later, N950, before it now hovers around N1,100 and N1,200. Those who were milking the nation with dirty diesel saw it and they reduced their cost too. We will do it again.”
However, the Nigerian National Petroleum Company Limited (NNPC) has stated that it will only buy Dangote petrol if it is cheaper than the international market price.
“The recent changes in PMS prices have no impact on the DRL or any other domestic refinery’s access to the Nigerian market,” said Olufemi Soneye, NNPC spokesman.
“In fact, if current prices are perceived as high, it presents an ideal opportunity for the refinery to sell its products at lower prices in the Nigerian market.”
The NNPC also declared that Dangote and other domestic refineries are free to sell directly to any marketer on a willing buyer, willing seller basis.
“We emphasise that there is no guarantee of lower prices associated with domestic refining compared to any global parity pricing framework, as confirmed by the DRL.
The NNPC Ltd will only fully off-take PMS from the DRL if the market prices of PMS are higher than the pump prices in Nigeria.”
