MAJOR petroleum marketers, and oil sector governance experts have cited reasons why the price of Premium Motor Spirit (PMS), popularly called fuel in Nigeria would drop further down.
Nigeria, recently witnessed price cuts in fuel pricing, following the total deregulation of the petroleum sector, which also informed the official removal of petroleum subsidies as announced by President Bola Tinubu.
Earlier, Dangote Petrochemical refinery informed of a price drop shortly before this year’s Ramadan fasting, announcing that the company would absorb N16 billion loss by refunding N65/litre to marketers so Nigerians will benefit from cheaper fuel.
Not just Dangote, the Nigerian National Petroleum Company Limited (NNPCL) has similarly announced a price cut signalling a deeper competition for market share in the petroleum downstream sector.
Already, checks by The ICIR confirmed that some retail outlets owned by the NNPCL adjusted their petrol pump price to N860 per litre on March 3, at the same rate Dangote sells petrol at MRS filling stations in Lagos.
Accordingly, the company’s stations in Lagos adjusted their pumps to N860 per litre, down from N945 as of Sunday-March 2. This comes a few days after the Dangote refinery reduced its ex-depot petrol price from N890 to N825 per litre.
Informed analysts are of the view that Nigeria’s naira stability against the United States dollar which exchanges at 1,496.7/$ as of today, March 5 and improved local refining capacity in addition to a stable oil price could see the price cuts further till June 2025.
“From an analysis point of view, I expect the price to go further down in June which is also largely dependent on the global currency market and global oil price,” the chief executive officer of Financial Derivatives, Bismarck Rewane, said in response to the ongoing price war among Petroleum downstream players.
“In a price war, nobody wins, the consumers win in the short run then eventually the market goes back to where it should be. But, at the end of the day, between now and June, the price leadership will be firmly established,” Rewane said.
Commenting further on the development, former chairman of the Major Oil Marketers Association of Nigeria (MOMAN), Adetunji Oyebanji, shared a similar view but observed that regulatory authorities should ensure fairgrounds for competition for all players.
“It’s a new dawn for the deregulated petroleum sector, but there’s a need to ensure a fair competitive ground for all players who may not have the financial muscle to withstand the momentum. The regulators should ensure there is fair play in the competition, “Adetunji said.
He suggested that some petroleum retail outlets collaborate in sorting out logistics problems to sustain their business.
Speaking further on the development, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike in response to the price cuts told The ICIR that prices would further go down if the NNPCL refineries across the nation performed optimally.
“If the Port Harcourt, Warri and Kaduna refineries work optimally, we would see more competition pushing down the petrol price. Many licensed refineries are also warming up to come on-stream and this will influence price cuts.
Recall, that on February 2, The ICIR reported that the Dangote refinery dropped its ex-depot price of petrol from N950 to N890, citing the decline in the price of crude oil at the international market.
“This strategic price adjustment is designed to provide essential relief to Nigerians in anticipation of the upcoming Ramadan season, while also supporting President Bola Ahmed Tinubu’s economic recovery policy by alleviating the financial burden on the Nigerian populace.
“It is important to note that Dangote Petroleum Refinery has consistently lowered the prices of petrol and other refined petroleum products to the benefit of Nigerians. This marks the second price reduction of PMS in February 2025, following a previous decrease of N60.00 earlier in the month,” the management said.
With the new adjustment in its ex-depot price of petrol, the refinery said the MRS Holdings filling stations would now sell for N860 per litre in Lagos, N870 in the South-West, N880 per litre in the North, and N890 per litre in the South-South and South-East respectively.
“The same product will also be available at the following prices in AP (Ardova Petroleum) and Heyden stations: N865 per litre in Lagos, N875 per litre in the South-West, N885 per litre in the North, and N895 per litre in the South-South and South-East,” it added.
With the consistent drop in the price and export of its refined petroleum products, the Dangote Petrochemical refinery company is gradually showing its market dominance in the Nigerian petroleum industries while the state-owned oil firm, Nigerian National Petroleum Company Limited (NNPCL), is behind.
Lately, the Dangote refinery sold two cargoes of aviation fuel to Saudi Aramco, the national oil company of Saudi Arabia.
In its monthly report for January 2025, the Organisation of Petroleum Exporting Countries (OPEC) noted that the emergence of Dangote refinery has reduced the importation of petroleum products from Europe to Nigeria.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.