Oil marketers in Nigeria have raised concerns over the delay in the announcement of the price of Premium Motor Spirit (PMS), also known as petrol, being produced by the Dangote Petroleum Refinery. The delay has created uncertainty in the market, with the landing cost of imported PMS now estimated at about N1,120 per litre.
This issue arises as dealers warn that if Dangote’s petrol price is too high, they will turn to importing the product, given the government’s recent liberalization of the market.
In July, the Major Energy Marketers Association of Nigeria revealed that the landing cost of PMS was N1,117 per litre. At that time, pump prices ranged from N600 to N700 per litre, but these have recently surged to between N855 and N897 per litre, with some independent dealers pricing PMS at over N1,000 per litre.
Abubakar Maigandi, National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), stated that IPMAN is actively engaged with foreign partners and awaiting Dangote’s price decision. He emphasized that a competitive price from Dangote would be critical in determining whether marketers would continue importing PMS.
“Allowing multiple importers to bring in PMS ensures availability and competition in the market,” Maigandi said, noting that competition would prevent price hikes and ensure that quality products are accessible.
Meanwhile, an unnamed Dangote Group official reassured that Aliko Dangote would strive to keep prices low for the benefit of Nigerians, citing the group’s earlier intervention in the diesel market, which saw prices drop significantly.
However, there appears to be tension between the Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPC) regarding the sale of PMS. While Dangote is prepared to sell locally, the NNPC has expressed reluctance to off-take Dangote’s petrol unless it is cheaper than international prices. The NNPC reiterated that the refinery is free to sell its product to any marketer on a willing buyer, willing seller basis.
The NNPC’s decision to maintain importation, despite the ongoing operational delays at its refineries, further complicates the situation. The company has stated that it would only purchase from the Dangote refinery if it offered a better deal than international suppliers.
As the oil sector anticipates the final price of Dangote’s petrol, stakeholders continue to navigate the complexities of a newly liberalized market, where competition, availability, and pricing will be pivotal in shaping the future of fuel supply in Nigeria.
