In a bold market-shifting move, the Dangote Petroleum Refinery has quietly slashed its ex-depot price of Premium Motor Spirit (PMS) to N825 per litre, intensifying competition with fuel importers and reshaping the dynamics of Nigeria’s deregulated downstream petroleum sector.
This price adjustment, though unofficially acknowledged, marks a N10 drop from the previously pegged N835 per litre. Industry insiders confirmed on Monday that the Lagos-based $20 billion refinery is offering the reduction as a post-evacuation rebate — a strategic pricing incentive to maintain its grip on over 50% of the domestic fuel market.
According to petroleum marketers, the rebate is granted after customers successfully load and evacuate products from the Dangote depot, effectively bringing the net price down to N825. This maneuver, aimed at undercutting importers and private depot operators, has pushed the average pump price across select depots to a competitive range of N827–N830 per litre.
Independent marketers attribute the price cut to the free-market forces triggered by the deregulation of Nigeria’s petrol sector. Speaking to ireport247news.com, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, said the price war is a reflection of healthy market competition.
“Yes, the latest price reduction was largely caused by competition between Dangote and importing marketers who are also reducing their prices. That is the beauty of deregulation,” Ukadike stated.
He emphasized that importation continues to act as a stabilizing factor, challenging any monopoly and ensuring market prices reflect global trends and local realities.
“Whatever Dangote is doing to its customers is a welcome development. Product evacuated is profit gained; stagnant product is stagnant capital,” he added, urging other depot owners to follow suit.
Market checks revealed a cascading effect of Dangote’s pricing strategy. Major depots such as MRS Tincan, Pinnacle, and the Dangote depot itself were seen selling petrol at N827 per litre on Monday — a sharp decline from N839 recorded the previous week.
Comparatively, import-dependent depots including Rain Oil, A.A Rano, A.Y.M Shafa, and NIPCO are offering the same product between N837 and N870 per litre — at least N12 to N43 higher than Dangote’s effective rate.
Marketers say this pricing gap is forcing many importers to re-evaluate their business models as Dangote continues to dominate supply and pricing.
“It’s a tactical discount move. While not officially advertised, Dangote is enabling marketers to lift at reduced costs,” said one dealer who requested anonymity. “Private depot owners are losing ground and have been forced to respond by lowering their prices.”
Oil and gas analyst, Olatide Jeremiah, said Dangote’s price rebate strategy is a calculated market dominance tactic. “The rebate is not just a discount; it’s a message. Dangote is signaling that it can dictate the market pace, and competitors must adjust or risk extinction,” he noted.
According to Jeremiah, local price trends are now more influenced by internal competition than international oil prices. “The Nigerian fuel market is undergoing a transformation. This is the first time domestic players are determining price behavior in real time. It’s a significant departure from the past,” he said.
Meanwhile, fresh data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) showed Nigeria’s daily average crude oil production climbed to 1.485 million barrels per day in April, up from 1.40mbpd in March.
Despite the improvement, the country remains slightly below the 1.5mbpd production quota set by the Organisation of the Petroleum Exporting Countries (OPEC). The commission revealed that peak production for April reached 1.73mbpd (including condensates), with average production aligning closely with OPEC’s expectations.
This upward trend could potentially enhance domestic refining capabilities and stabilize input costs for the Dangote refinery and others.
The latest move by the Dangote Refinery reinforces its growing dominance in Nigeria’s petrol market. With more than half of the country’s market share under its control and a flexible pricing model, it is shaping not only local competition but also consumer expectations.
As importers struggle to keep pace and the government seeks to boost crude production, all eyes remain on the refinery’s next pricing decision — a factor that could determine the trajectory of Nigeria’s deregulated fuel economy in the months ahead.