The competition in Nigeria’s downstream oil sector reached new heights on Tuesday as major oil marketers slashed their prices, challenging the N825 per litre gantry loading rate set by Dangote Petroleum Refinery.
This development follows reports that the landing cost of imported Premium Motor Spirit has dropped to N774.72 per litre.
Marketers say this price decline could push pump prices down to around N800 per litre.
Industry sources disclosed that the N774.72 per litre landing cost, which includes shipping, import duties, and exchange rate factors, represents a significant N50.28 reduction from Dangote’s N825 per litre ex-depot price.
This price gap has prompted many marketers to shift preference towards imported fuel rather than relying on refinery supplies.
The PUNCH reported that this downward trend in PMS landing costs is likely to impact retail pump prices and renew interest in petrol importation.
“Crude oil is a major component in the production of fuel, so a further reduction in its price would definitely warrant a drop in petrol price, and it is possible to drop to N800 per litre,” said Chief Ukadike Chinedu, National Publicity Secretary of the Independent Marketers Association of Nigeria.
Just last week, the Nigerian National Petroleum Company Limited (NNPC) adjusted its pump prices downward, selling petrol between N860 and N880 per litre in Lagos and Abuja, compared to its previous rates of N945 and N965 per litre.
This reduction followed Dangote Refinery’s decision to cut its own retail price to the same range.
The refinery, which has made three price reductions in the past two months, had earlier slashed its ex-depot price from N890 to N825 per litre, a move that was welcomed by consumers.
However, the price cuts triggered a fierce competition among private marketers aiming to capture a larger market share, particularly in a price-sensitive economy.
For petrol importers, the price drop resulted in significant financial losses, with daily revenue losses estimated at N2.5 billion and monthly losses reaching about N75 billion.
In response, many importers have secured fresh shipments at lower costs, further intensifying market competition.
Market Dynamics and Shifting Preferences
According to the latest competency centre daily energy data from the Major Energies Marketers Association of Nigeria, obtained on Tuesday, the estimated import parity price into tanks has fallen to N774.82 per litre, a sharp N152.56 (16.5%) reduction from the N927.48 per litre recorded on February 21, 2025.
The 30-day average landed cost also declined to N864.92 per litre, while on-the-spot sales at the NPSC terminal stood at N927.53 per litre.
This shift is largely attributed to a drop in Brent crude oil prices, which fell from $76.48 to $70.36 per barrel, coupled with an exchange rate of N1,517.24 per dollar.
These factors have given private depot operators and independent marketers a competitive advantage, allowing them to offer more affordable alternatives to Dangote’s refinery products.
A survey of private depot prices revealed that AA RANO, MENJ, and MRS TINCAN depots have all reduced their loading prices to N830 per litre. WOSBAB and AITEO depots are selling at N832 per litre, while RAINOIL offers its product at N831 per litre.
By contrast, marketers who purchased fuel from Dangote Refinery at N825 per litre are now selling at N835 per litre— earning a modest N1 profit while still pricing their fuel N4 higher than private depots.
Experts Predict Further Price Cuts
Industry analyst Olatide Jeremiah predicts that the ongoing price war may force Dangote Refinery to lower its ex-gantry price in order to remain competitive.
Jeremiah, CEO of petroleumprice.ng, noted that marketers are increasingly turning to private depots due to their relative price stability.
“Last week, prices particularly for petrol and diesel started dropping, and on Thursday, it went below Dangote’s ex-depot price. The refinery price is N825 per litre and marketers will pay N9 for NMDPRA fees and other levies making a total of N834 per liter.
“Even as I speak, marketers that bought from Dangote and still have old stock are selling at zero profit. So most of the marketers stopped buying. Many depots also started selling at N830, even MRS, that get products from Dangote, while marketers at the Dangote refinery sold between N835 or N834 today to finish their stock.
“Other private depots are selling at N830 or N831 per liter. The reason is that private depots got a cheaper product even less than Dangote coastal price of N780. But the landing cost is less than that amount. Another scenario is the MRS and Ardova got their product at the coastal price which will enable them to sell at N834.
“The expense to the truck from Dangote refinery is between N40 to N45, so it is not a good deal. I can tell you at the Dangote depot today, the place was deserted, marketers trading there have now switched to private depots. This is likely to force Dangote to reduce its price.
“Rumours are already spreading because private depots are now making good sales. The back and forth of prices has made marketers uncomfortable. They are counting their loss and that is why they now patronise private depots where there is a bit of stability.”
Call for Regulatory Intervention
Meanwhile, the Petroleum Products Retail Outlet Owners Association of Nigeria has expressed concerns over the frequent fuel price fluctuations, stating that marketers continue to suffer heavy losses.
Despite the deregulation of the downstream sector, PETROAN has called for price stabilization measures, advocating for a policy that ensures price changes occur only every six months.
In a statement, PETROAN Publicity Secretary Joseph Obele stressed that fuel imports should be encouraged to prevent market monopolies.
As the battle for competitive pricing continues, industry players anticipate further price shifts in the coming weeks, with potential implications for both consumers and petroleum marketers across the country.
