Fuel distributors are contemplating a shift from Dangote fuel due to a notable decline in the price of imported petrol, which has become less expensive than the tariffs established by the Dangote Petroleum Refinery.
As of Friday, the arrival cost of Premium Motor Spirit (PMS) was noted to be N922.65 per litre, a drop of N32.35 from the N955 per litre at Dangote’s loading terminal. This decrease, which incorporates shipping, import taxes, and currency fluctuations, might alter the market landscape, motivating distributors to import petrol instead of depending on Dangote’s supply.
This pricing drop opens up avenues for importers to take advantage of more affordable products, and many retailers are anticipated to seek imports owing to the financial leverage. A prominent distributor, speaking under the condition of anonymity, remarked that the lower price of imported petrol is a compelling motivation. Last Sunday, Dangote Petroleum Refinery clarified that the recent increase from N899.50 was due to rising crude oil prices, a critical component in refined petroleum products. Nonetheless, the decrease in landing costs hints at a possible relief from the instability in global oil rates.
In spite of this price reduction, retail fuel prices in Nigeria remain elevated, with major distributors offering petrol for between N990 and N1,010 per litre in the Federal Capital Territory. According to the latest figures from the Major Energies Marketers Association of Nigeria, the import price of petrol has fallen by 2.2% to N922.65 per litre from N943.75 per litre earlier in the week. The price of Brent crude has also been reported to have declined, further benefiting the importers.
This transformation has afforded independent marketers and private depot proprietors an opportunity to earn profits by sourcing lower-priced petrol, with the ex-depot price now ranging from N950 to N990 per litre. While this is perceived as a positive development for participants in the downstream oil and gas sector, the price variations remain profoundly influenced by exchange rates and freight expenses.
In a surprising development, oil marketers have imported a cumulative 76.84 million litres of petrol within merely two days, according to data from the Nigerian Port Authority. This was made possible by two vessels that docked at the Apapa and Tincan ports in Lagos, along with another two vessels arriving at the Dangote terminal at Lekki Deep Seaport. The National President of the Petroleum Products Retail Outlets Owners Association of Nigeria, Billy Gillis-Harry, expressed astonishment at these imports, suggesting that stakeholders had agreed to abstain from importing refined products while the Dangote refinery expanded its production capacity.