The Dangote Refinery has clarified that the recent adjustment in the pump price of Premium Motor Spirit (PMS), commonly referred to as petrol, is a direct result of rising global crude oil prices. This announcement follows public outcry over the hike, which saw petrol prices climb from ₦899 to ₦955 per litre.
Addressing the issue, Mr. Anthony Echiejina, Head of Corporate Communications at Dangote Industries, said in a statement on Sunday: “Any change in international crude prices inevitably affects the cost of the finished product.”
The spike in petrol prices stems from an increase in Brent crude oil prices, which jumped from $70 to $82 per barrel in recent months. This 15% surge in crude prices has rippled across global markets, affecting production costs for refineries, including Dangote Refinery.
Despite this challenging economic environment, Dangote Refinery has absorbed approximately 50% of the increased costs, according to Echiejina. “If we were to pass on the full increase in crude oil prices, the retail price of PMS could have risen to as much as ₦1,150 to ₦1,200 per litre in some areas,” he noted.
To cushion the impact on Nigerians, Dangote Refinery has made only a modest 5% adjustment to its ex-depot price, raising it from ₦899.50 to ₦950 per litre. The ex-vessel price remains unchanged at ₦895 per litre, ensuring that petrol is sold at a retail price of ₦970 per litre nationwide, including in remote areas.
“This strategy is part of our commitment to ensuring uniform pricing across all 36 states and the Federal Capital Territory (FCT),” Echiejina stated. “We have also absorbed increased logistics costs, aiming to shield consumers from excessive price shocks.”
In a move aimed at maintaining trust and transparency, Dangote Refinery announced plans to publish its ex-depot, ex-vessel, and pump prices weekly. This initiative seeks to protect Nigerians from potential price exploitation by third-party suppliers.
“We believe in providing clarity and transparency to our consumers,” Echiejina explained. “This approach ensures that everyone knows the factors driving the price adjustments.”
The company also expressed appreciation for the federal government’s “Naira for Crude” initiative under President Bola Tinubu’s administration. This policy, aimed at maintaining steady access to high-quality PMS, has been a critical factor in mitigating the full impact of global oil price fluctuations on Nigerians.
“This initiative has been instrumental in stabilizing supply and ensuring Nigerians have access to affordable petrol despite the volatility of the global oil market,” Echiejina added.
The hike in petrol prices comes against the backdrop of ongoing global energy market disruptions. Factors such as geopolitical tensions, reduced crude oil supply from major producers, and increasing demand have pushed up prices.
For Nigeria, a country that heavily depends on imported petroleum products despite being a crude oil producer, these global shifts have a profound impact. The Dangote Refinery, commissioned to reduce reliance on imports and enhance self-sufficiency, is working to balance its operational costs with its commitment to affordable pricing.
Echiejina stressed that the refinery’s primary focus remains the protection of Nigerian consumers. “We are committed to providing high-quality petrol at competitive prices while supporting Nigeria’s economic growth and self-sufficiency.”
The recent adjustment has sparked debates among citizens and stakeholders. Some consumers worry that the price increase will lead to a domino effect, raising transportation and food costs. However, others view the refinery’s measures as a necessary response to global economic realities.
Market observers note that the refinery’s decision to absorb a significant portion of the cost increase is commendable. “In many countries, such global shocks would translate to far steeper price hikes,” said an economist based in Lagos.
As the global oil market continues to fluctuate, Nigerians brace for potential future adjustments in petrol pricing. The Dangote Refinery, however, remains optimistic about its ability to manage costs while keeping prices as low as possible.
In his closing remarks, Echiejina expressed gratitude to Nigerians for their support during these challenging times. “We thank our consumers for their understanding and patience as we work to provide the best value for money. Together, we can build a stronger, more resilient Nigerian economy.”
