Petrol retailers along the busy Lagos–Ibadan Expressway are stepping up price competition, slashing pump prices in a bid to attract motorists and defend market share as Nigeria’s downstream petroleum market enters a new phase of rivalry.
A weekend survey across the Mowe–Ibafo axis of Ogun State revealed that several filling stations have reduced the price of premium motor spirit (PMS) well below ₦839 per litre, the rate recommended by the Dangote Petroleum Refinery after its recent upward review of gantry prices.
The development reflects mounting pressure on marketers to respond to changing supply dynamics, falling import landing costs and consumer resistance to higher fuel prices amid persistent economic strain.
Petrol Retailers Slash Prices Amid Rising Competition
Findings show that pump prices, which averaged ₦839 per litre barely a week ago, have now dropped to between ₦812 and ₦830 per litre at several outlets, signalling the emergence of a full-blown price war.
SGR Filling Station in Mowe was observed selling petrol at ₦812 per litre, the lowest price recorded along the axis. Alade Filling Station near Ibafo dispensed PMS at ₦820 per litre, while Habeeb Filling Station adjusted its price to ₦819 per litre.
Similarly, SAO stations in both Mowe and Lotto reduced their pump prices to ₦825 per litre, matching Akiavic Filling Station, which also sold at the same rate. NIPCO outlets along the highway offered petrol at ₦828 per litre, while AP filling stations sold between ₦830 and ₦834 per litre.
The intensified competition forced even Dangote-partnered outlets to respond. The MRS filling station at Olowotedo cut its price to ₦825 per litre from ₦839, although its outlet near the Redeemed Christian Church of God camp maintained the higher price, despite nearby competitors adjusting downward.
Changing Cost Dynamics in the Fuel Market
Industry analysts say the latest price cuts are being driven by a shift in cost fundamentals. Data from the Major Energies Marketers Association of Nigeria (MEMAN) indicate that the landing cost of imported petrol now averages ₦724 per litre, significantly lower than the Dangote refinery’s current gantry price of ₦799 per litre
This creates a margin gap of about ₦75 per litre, giving retailers flexibility to adjust pump prices aggressively without necessarily operating at a loss.
An official of the Dangote refinery, who spoke on condition of anonymity, said the refinery’s gantry price already includes statutory charges and logistics considerations, leaving room for marketers to compete on pricing.
“Many stations selling below ₦839 are still lifting products from the Dangote gantry,” the official said, countering speculation that cheaper fuel must be imported.
How Retailers Slash Petrol Prices to Win Customers
Market watchers note that fuel pricing has become a key competitive tool as deregulation deepens and consumers grow more price-sensitive.
Unlike previous years when pricing was largely uniform, retailers now adjust rates strategically based on location, traffic volume and competitor presence.
The Lagos–Ibadan Expressway, one of Nigeria’s busiest transport corridors, has become a testing ground for this competition. Stations with high vehicular traffic can afford slimmer margins, while others lower prices to draw motorists away from rival outlets.
Before the recent gantry price increase, imported PMS struggled to compete with Dangote-supplied fuel when the refinery sold at ₦699 per litre. Importers incurred higher costs and were priced out of the market, allowing Dangote-backed stations to dominate.
However, the current reversal—where imported petrol is cheaper at landing—has reshaped competition and emboldened independent marketers to slash prices.
Dangote Refinery Warns on Distribution Costs
Amid the unfolding price war, the Dangote refinery has cautioned that Nigeria’s continued reliance on coastal delivery and vessel-based distribution could push petrol prices close to ₦1,000 per litre in the long term.
In a statement, the refinery emphasised that gantry loading remains the most efficient and cost-effective distribution method, noting that it has invested heavily in infrastructure to stabilise domestic fuel supply.
The company highlighted its 91-bay gantry facility, capable of loading up to 2,900 tankers daily, operating around the clock. According to the refinery, the facility can evacuate more than 50 million litres of PMS and 14 million litres of diesel daily, reducing logistics bottlenecks and distribution costs.
Background: Price Cuts, Imports and Regulatory Tensions
The current pricing tension follows a turbulent period in December, when Dangote Group President Aliko Dangote slashed the petrol gantry price by ₦129, saying the move was aimed at ensuring Nigerians paid no more than ₦740 per litre during the festive season.
Dangote also accused the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) of issuing what he described as excessive import licences at a time when local storage tanks were full.
While marketers complained of losses due to the sudden price drop, Dangote said the refinery was also absorbing significant losses to stabilise the market.
Data from the NMDPRA later showed that petrol imports fell from 52.1 million litres per day in November to 42.2 million litres per day in December, while supply from the Dangote refinery rose sharply from 19.5 million litres per day to 32 million litres per day over the same period.
Dispute Over Product Importation Claims
Responding to allegations that it imports finished petroleum products, the refinery described such claims as misleading, clarifying that only intermediate feedstock was being imported due to maintenance on its Residue Fluid Catalytic Cracking Unit.
“We challenge anyone with credible evidence of finished product importation to present it to the appropriate authorities,” the company said, insisting that such claims were driven by interests seeking to justify continued fuel importation.
The refinery further argued that domestic refining has delivered tangible benefits, citing a drop in diesel prices from about ₦1,700 per litre to below ₦1,000, and a reduction in PMS prices from around ₦1,250 to between ₦839 and ₦900 per litre.
Outlook: Will Lower Prices Last?
Analysts warn that while retailers slash petrol prices for now, the sustainability of the reductions will depend on several variables, including:
Exchange rate stability
Import volumes and logistics costs
Refinery pricing decisions
Regulatory policies
With competition intensifying and consumers increasingly price-conscious, retailers may continue to adjust prices aggressively in the short term. However, any sharp movement in foreign exchange or supply disruptions could quickly reverse the trend.
For now, motorists along the Lagos–Ibadan corridor are benefiting from one of the most competitive fuel pricing environments Nigeria has seen in years.
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