The Dangote oil refinery is set to lose up to N32.5 billion from its 500 million-litre petrol stock following its recent price cut, which has disrupted fuel pricing dynamics in Nigeria.
Before the reduction, the refinery was selling petrol at N890 per litre, meaning its 500 million litres were valued at N445 billion. However, after slashing the ex-depot price to N825 per litre on February 27, the stock is now worth N412.5 billion, wiping out N32.5 billion in potential revenue. This marks the second price cut this year, following an earlier N60 reduction in February and a N70.50 cut in December 2024 during the yuletide season.
The price drops have been widely celebrated by Nigerians, who have seen a decline in pump prices across the country. Many filling stations have adjusted their rates, with Nigerian National Petroleum Company Limited (NNPCL) retail outlets lowering their prices to N860 per litre in Lagos. However, fuel importers and marketers are struggling, with some reportedly losing billions as they are forced to sell imported products at reduced margins to remain competitive. Some estimate daily losses of N2.5 billion, amounting to N75 billion monthly.
Marketers with old stock have been particularly hit, as they must now sell at reduced prices, cutting into their profits. The trend has raised concerns among importers, who argue that Dangote’s aggressive pricing strategy is making fuel importation increasingly unattractive.
Despite the losses, industry analysts suggest that the refinery may recover through falling global crude prices and the naira’s slight appreciation against the dollar. They also predict that petrol prices could decline further to N800 per litre, as the current landing cost stands at N783.66 per litre, according to the Major Energies Marketers Association of Nigeria.
Meanwhile, consumers have urged Dangote to expand the number of filling stations selling its products, ensuring more Nigerians benefit from the lower fuel prices.
