Edited By Ali Musa
Axadle Times International–Monitoring.
In a move that has reverberated across the fuel market, the Dangote Refinery made headlines on Wednesday by announcing a significant reduction in the ex-depot price of petrol. The price has been slashed by N65, bringing it down from N890 to N825 per liter.
At first glance, this may appear as just another business decision, but as with many things in life, the ripple effects reach far and wide. Starting on the 27th of February, importers have scrambled, grappling with the task of recalibrating their prices in light of this new development.
“It is important to note that Dangote Petroleum Refinery has consistently lowered the prices of petrol and other refined petroleum products to the benefit of Nigerians,” the refinery emphatically stated. Such gestures resonate with many, inspiring a sense of loyalty and gratitude among the populace.
This marks the second price reduction of Premium Motor Spirit (PMS) in February 2025, following a previous decrease of N60 earlier in the month. Such strategic decisions prompt us to ask: What drives these price reductions, and how do they reflect larger socio-economic objectives?
As you delve deeper into the rationale, it becomes clear that this adjustment aims to prepare Nigerians for the Ramadan season. Additionally, it’s a nod towards supporting President Bola Tinubu’s economic recovery plan, an effort to lessen the financial burdens weighing down on the citizens of the country.
However, not everyone welcomes the shift with open arms. According to a report by the Punch Newspaper, some importers lament that the necessity to adjust their own prices could force dealers to sell below cost, a perilous position in any business.
A dealer speaking on condition of anonymity to the Punch confessed, “Some of us who have imported PMS are feeling the heat of Dangote’s decision to slash prices. Though it is a good thing to reduce the petrol price, it is taking a toll on our business. That’s the simple truth.”
Such candid confessions underscore a larger narrative of competition and survival in a fiercely competitive market. Another dealer shared a prediction: “Numerous importers will have to quit bringing in petroleum goods from other nations as a result of the Dangote refinery’s price reductions to deter gasoline importation.”
Of course, every story has multiple sides. Reflecting on the scenario, another retailer remarked, “Dangote understands the competition in the business, and this latest reduction will further discourage fuel imports. There will be losses as we may have to drop our prices too. At the end of the day, some of us will source our products locally. I will just advise Dangote to create a level playing field for all.”
Interesting enough, current data suggests that the landing cost of PMS is around N927 per liter. A poignant detail that casts a shadow over these adjusted ex-depot prices. Selling with narrow profit margins becomes a delicate balancing act.
In any market, competing effectively is the key driver. Yet, as many importers have found, when selling imported goods with minimal margins, sustainability becomes an elusive target. Perhaps the broader question here is: In a race where the rules are constantly changing, what will be the long-term impacts on the landscape of the Nigerian fuel market?
