Marketers retain high petrol price despite reduction at Dangote Refinery

By Obas Esiedesa, Abuja

Fuel marketers in Abuja continued to sell Premium Motor Spirit (PMS) at the same prices more than 24 hours after Dangote Petroleum Refinery announced a reduction in its ex‑depot price.

Our correspondent found that major retail outlets had not yet adjusted their pump prices, despite the refinery’s announcement of a N75 per litre reduction on Monday.

At the stations visited, NNPC Retail and TotalEnergies sold petrol at N1,335 per litre, AA Rano at N1,350 per litre, and AYM Shafa and Conoil outlets at N1,330 per litre.

The situation comes amid public expectations that the drop in Dangote Refinery’s gantry price would quickly translate into lower pump prices nationwide.

Dr. Billy Gillis‑Harry, President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), explained the delay by noting that retail prices are influenced by factors beyond refinery gate prices.

Speaking to Channels TV, Gillis‑Harry said: “Prices reflecting at the pump are dependent on availability of the product, the other is the cost. The cost of purchasing the product and cost in terms of logistics, and preparing the particular petroleum to be delivered to the people.”

He added that downward price adjustments often take longer to reach consumers because marketers need to recover the cost of existing stock purchased at higher prices before restocking at lower rates.

When asked why increases in fuel prices are usually reflected immediately while reductions are delayed, Gillis‑Harry said supply‑management dynamics play a significant role.

He explained: “It is mainly affected by whether the producer has additional resources or not at the time. Increases in prices are mainly caused by the need to restock. There must be that advantage pushing the price upward to be able to pay for new supplies.”

He further acknowledged that marketers generally seek to exhaust existing inventory before implementing lower prices.

“That’s the basic idea. But in petroleum, a mixture is involved, and loss is taken, though not in a way that affects the capital needed to restock,” he added.

Energy analyst Olabode Sowunmi also weighed in, saying fuel pricing in Nigeria is influenced by a combination of domestic supply arrangements and logistics costs, rather than crude oil prices alone.

He noted that although international crude oil prices remain an important factor globally, their impact on local petrol pricing is not always direct.

“Global price of crude oil is a factor internationally and not necessarily in Nigeria,” Sowunmi said.

He explained that Dangote Refinery operates under arrangements that allow a portion of crude supply to be priced in naira, reducing the direct impact of international market fluctuations on local fuel prices.

“So basically the issue will have to be from the point of refinery to where it touches the final person,” he stated.

According to him, logistics costs within the domestic supply chain remain a major determinant of the final pump price paid by consumers.

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