The Chairman of the Dangote Group: Aliko Dangote has said that Premium Motor Spirit popularly referred to as petrol from his refinery would hit the market in the 3rd week of July. While this is cause for celebration, marketers across the country have expressed concern about the influence this could have on the market. They, unlike most of the general public, believe that Dangote’s Petrol would be more expensive than people currently hope.
Dangote’s refined petrol is set for distribution and sale before the end of the month, a development that has been highly anticipated since the commissioning of the Dangote refinery back in May 2023.
Given that this is the first time a private enterprise would be selling petrol to Nigerians, it is generally believed that the Dangote product would influence the market to begin offering competitive prices. However, according to a report by the Punch newspaper, this has become unlikely.
Marketers are worried that Dangote petrol price may be higher than people hope. This is because the Dangote Refinery continues to buy crude oil from the United States and other nations at a greater cost, the same factor that made the Dangote diesel and aviation fuel expensive.
A series of interviews conducted by the Punch newspaper with marketers brought this revelation to light. They believe that the imported crude oil would increase the cost of production, perhaps raising the ex-depot price of the Dangote PMS.
This new development, should it be true would be devastating for Nigerian consumers given the fact that petrol prices have gone up from as low as N200 on average to N700 currently, in the space of a year, and the Dangote refinery had brought hope for a price deflation.
In May 2023, during the inauguration of President Bola Tinubu, the president decreed that fuel subsidies should immediately be removed, sending shockwaves across the market and causing an immediate hike in the price of this essential commodity.
What the marketers said
In a conversation with the Punch’s correspondent, Hammed Fashola, the National Vice President of the Independent Petroleum Marketers group of Nigeria, stated that the group was concerned that crude imports would raise the price of Dangote petrol.
“You know when he keeps bringing crude oil from the United States, that is another cost. That is another problem we are scared of because it will still boil down to the high cost of petrol, unlike where he can source the crude locally in Nigeria,” the vice president stated.
“I will advise that the government should assist Dangote in the supply of crude oil. If Dangote can get an adequate supply of crude oil locally, I think the whole problem will be solved somehow. I don’t think there will be any need for anybody to go and bring in petrol again, especially if Dangote is selling at a reasonable price,” he added.
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