IPMAN and PETROAN Indicate Potential Price Cut for Dangote Petrol

Nigeria’s petroleum marketers are optimistic they can sell Premium Motor Spirit (PMS), also known as petrol, at a lower price than the Nigerian National Petroleum Company Limited (NNPCL) if they begin purchasing fuel directly from the Dangote Refinery. This was revealed by Chinedu Ukadike, the spokesperson for the Independent Petroleum Marketers Association of Nigeria (IPMAN). continue Reading>>>...CONTINUE READING>>>

Ukadike provided this assurance while updating the public on petroleum marketers’ efforts to secure direct fuel purchases from the Dangote Refinery.This announcement comes after the Federal Government, through the Minister of Finance and Chair of the Naira-for-crude Implementation Committee, Wale Edun, confirmed that marketers are now allowed to buy fuel directly from Dangote Refinery, bypassing NNPC.This development marks the end of NNPC’s role as the exclusive buyer of petrol from the Dangote Refinery.

Initially, NNPC was the sole distributor of the petrol produced at the refinery during its first distribution.However, last Friday, Edun explained that part of the Naira-for-crude deal allowed fuel marketers to directly lift petrol from Dangote Refinery without NNPC acting as a middleman.

This shift comes as petrol prices at NNPCL stations in Abuja recently spiked to N1,030 per litre, while other stations sell petrol between N1,100 and N1,200 per litre. Additionally, NNPCL set its ex-depot prices (the price marketers pay to buy petrol at depots) between N1,040 and N1,100.Petroleum marketers had previously rejected NNPCL’s ex-depot prices. The government’s approval of direct fuel purchases from Dangote Refinery offers marketers an alternative to relying on imported fuel.

Responding to the new development, Ukadike said that IPMAN members, who control 70% of the filling stations in Nigeria, are eagerly awaiting Dangote Refinery to begin direct sales to them.Ukadike noted that direct purchases from Dangote Refinery would eliminate additional fees that NNPCL adds to the product. He emphasized that once marketers begin buying directly from Dangote, the price of petrol will drop below the current N1,030 per litre sold at NNPCL stations in Abuja.”countinue Reading>>>

We’re waiting for Dangote Refinery to start selling petrol directly to our members, and we expect a new price structure. Our fuel prices will be lower than NNPC Retail because we will cut out the fees NNPC adds on top before selling to marketers. We rely on profits from sales turnover, not salaries. We hope to meet with Dangote Refinery soon,” Ukadike told DAILY POST.In a similar vein, Billy Gillis-Harry, President of the Petroleum Products Retail Outlets Owners Association (PETROAN), confirmed to DAILY POST that Dangote Refinery has yet to respond to their request for direct petrol purchases.

Gillis-Harry stressed that without a clear price structure from Dangote, it would be difficult for marketers to proceed with purchasing. “They asked for a formal request from us, but we haven’t heard back yet. We can’t just send trucks to the refinery without knowing the price of the product. We are, however, eager to support Dangote Refinery,” he explained.Despite these optimistic projections, marketers are cautious, as fuel price increases have occurred following the initial distribution of petrol from Dangote Refinery.Oil and gas expert, Olabode Sowunmi, remarked that Dangote Refinery did not begin producing PMS to sell it cheaply to Nigerians.

Fuel prices have surged under President Bola Ahmed Tinubu’s administration. DAILY POST recalls that petrol prices jumped to N1,030 on October 9, 2024, from N238 per litre in June 2023, following Tinubu’s inauguration.In June 2023, Tinubu’s removal of the fuel subsidy caused the petrol price to rise from N238 to over N600 per litre. By September 16, 2024, NNPCL implemented another hike, pushing prices up to between N1,030 and N1,200 per litre.Beyond petrol, the prices of diesel and Liquefied Petroleum Gas (LPG) have also risen sharply. Diesel hit N1,406 per litre in August 2024, while a 12-kilogram cylinder of LPG now costs N15,552.56, up from N9,194.41 the previous year. Continue Reading>>>

These price hikes, along with rising food costs and fluctuations in the naira, have worsened economic conditions under Tinubu’s government.In April 2024, the Nigerian Electricity Regulatory Commission approved a 240% increase in electricity tariffs for Band A customers, who receive 20 hours of power daily. This hike raised electricity prices from N66 to N209.5 per kilowatt-hour.Despite the tariff increase, Nigeria continues to face electricity supply issues, generating only 5,000 megawatts for a population of over 200 million.

Repeated national grid collapses have further exacerbated the country’s power challenges, with the most recent collapse occurring on Monday, marking at least the fifth such incident in 2024.Despite the economic difficulties, President Tinubu remains optimistic. Speaking at the Nigerian Economic Summit Group event on Monday, Tinubu, represented by Vice President Kashim Shettima, expressed confidence that Nigeria will overcome its challenges with the right policies. He urged Nigerians to collaborate, emphasizing that the current issues are surmountable.