The price war in Nigeria’s downstream petroleum sector has intensified, with several filling stations now selling Premium Motor Spirit (petrol) below the N739 per litre pump price recommended by the Dangote Petroleum Refinery.
Findings show that the latest reductions follow Dangote Refinery’s decision in December to cut its ex-gantry price from about N900 to N699 per litre, forcing importers and depot owners to adjust retail prices in order to remain competitive, despite mounting losses.
During a weekend survey, it was observed that some stations now sell petrol cheaper than MRS Oil, the refinery’s major retail partner tasked with implementing the N739 pump price. As of Sunday, NIPCO sold PMS at N738 per litre, SAO stations at N735, Akiavic at N737, while an AP filling station beside an MRS outlet in Mowe, Ogun State, dropped its price to N736 per litre.
Industry sources said intense competition has compelled stations operating within the same locations to closely monitor one another’s pump prices, as motorists increasingly patronise outlets offering the lowest rates. Stations selling at higher prices were observed to record low customer turnout.
Data from the Major Energies Marketers Association of Nigeria indicate that the average landing cost of imported petrol stood at N762.38 per litre, while Dangote’s ex-gantry price remained N699. Despite this gap, importers were forced to slash prices to retain market share and compete with Dangote-backed retailers.
An operator, who spoke on condition of anonymity due to competitive pressures, said the price reductions were driven by survival rather than cost advantages. “This is not a function of whether imported fuel is cheaper or not. It is simply a market strategy to stay relevant. We are not at war with any marketer or refinery,” the source said.
The President of the Dangote Group, Aliko Dangote, had earlier vowed to ensure that pump prices remained below N740 nationwide, accusing some marketers of attempting to keep prices artificially high. “We are going to use whatever resources we have to crash the price down. For December and January, we don’t want petrol sold above N740,” Dangote said.
Commenting on the situation, the spokesperson of the Independent Petroleum Marketers Association of Nigeria, Chinedu Ukadike, said price competition would determine patronage going forward. “Demand and supply will regulate the market. If you refuse to reduce prices, customers will leave and bank interest will eat up your capital,” he said.
