The Dangote Refinery has announced a reduction in the price of petrol, slashing its ex-gantry loading cost to ₦865 per litre. This marks a ₦15 drop from the previous price of ₦880 per litre, which was in effect just a day earlier. The new price was communicated to marketers and customers in a notice sent out on Thursday morning.
The announcement is part of the refinery’s ongoing efforts to streamline costs and align with recent policy changes aimed at stabilizing the country’s petroleum sector. The reduction in price has already been confirmed through checks on various sources, including the petroleum pricing website, petroleumprice.ng, and a pro forma invoice sighted by industry insiders.
This development comes amid growing expectations surrounding Nigeria’s push to boost local refining capacity, reduce dependence on foreign exchange for fuel imports, and stabilize domestic fuel prices. As the government works to implement a series of reforms, including the Naira-for-Crude initiative, the Dangote Refinery is poised to play a significant role in Nigeria’s long-term energy security strategy.
The price cut at Dangote Refinery follows a key policy directive from the Federal Executive Council regarding the Naira-for-Crude agreement, which was initially suspended but has now been revived. This initiative aims to facilitate direct transactions between local refiners and foreign suppliers of crude oil in Nigeria’s national currency, the Naira, rather than relying on the US dollar. This move is expected to bolster the local refining industry and reduce Nigeria’s dependence on foreign currencies to fund fuel imports.
On Wednesday, the Federal Executive Council, after months of delay, directed the full implementation of the Naira-for-Crude agreement. This initiative has been hailed as a major step toward increasing the efficiency of local refineries and improving Nigeria’s energy security. The Federal Ministry of Finance confirmed the policy shift in a statement published on its official X handle, detailing the outcomes of a meeting between the Minister of Finance, Wale Edun, and Dangote Refinery representatives. The meeting focused on progress and the ongoing implementation of the policy.
The statement emphasized that the Naira-for-Crude initiative is not a temporary measure but rather a long-term policy designed to support sustainable local refining, reduce foreign exchange dependence, and strengthen Nigeria’s energy sector.
“The Crude and Refined Product Sales in Naira initiative is not a temporary or time-bound intervention, but a key policy directive designed to support sustainable local refining, bolster energy security, and reduce reliance on foreign exchange in the domestic petroleum market,” the Ministry of Finance noted.
The revival of the Naira-for-Crude agreement is a significant development for Nigeria’s refining industry. In recent years, the country has faced major challenges in refining its own crude oil, leading to a reliance on fuel imports and foreign exchange to meet domestic demand. This has placed enormous pressure on Nigeria’s foreign reserves, contributing to fluctuations in the value of the Naira and rising fuel prices.
The Dangote Refinery, one of Nigeria’s largest privately-owned refineries, has long been seen as a potential game-changer for the country’s energy landscape. With a production capacity of 650,000 barrels per day, the Dangote Refinery is poised to significantly reduce Nigeria’s dependence on fuel imports and increase domestic refining capacity.
The implementation of the Naira-for-Crude agreement is expected to streamline transactions and foster a more stable and self-sufficient domestic fuel market. By using the Naira in international crude oil transactions, Nigeria hopes to reduce the pressures of currency volatility and create a more predictable pricing structure for petroleum products.
The Dangote Refinery’s price cut signals the refinery’s commitment to playing a central role in this transformation. With its ability to refine a significant portion of Nigeria’s crude oil domestically, the refinery has become a cornerstone of the government’s vision for energy self-sufficiency.
Chinedu Ukadike, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), welcomed the price reduction, reassuring Nigerians that the cut would likely result in lower fuel prices across the country. Ukadike also commented on the government’s renewed commitment to the Naira-for-Crude agreement, highlighting its potential to stabilize the Nigerian oil market and reduce the country’s reliance on costly fuel imports.
“We are optimistic that with the implementation of this policy, local refiners like Dangote will help reduce the burden on Nigerians by stabilizing fuel prices,” Ukadike said. “It’s a positive step towards making fuel more affordable for the average Nigerian.”
However, some independent marketers have expressed concerns about the challenges of ensuring that price reductions are passed down to consumers. In many parts of the country, the cost of fuel at the pump often exceeds official prices due to factors such as transportation costs and the influence of middlemen in the supply chain.
The Dangote Refinery’s price cut is part of a broader strategy to strengthen Nigeria’s energy security and reduce the country’s reliance on imported petroleum products. With Nigeria sitting on vast reserves of crude oil, the country has long struggled to harness its full refining potential. Refineries, such as the state-owned ones in Port Harcourt, Warri, and Kaduna, have operated far below capacity due to years of neglect, underinvestment, and mismanagement.
The Dangote Refinery represents a new hope for the country, offering the possibility of not only meeting local fuel demand but also exporting refined products to other countries in Africa and beyond. This could help boost Nigeria’s position as a key player in the global energy market.
In addition to the Naira-for-Crude agreement, the Nigerian government has made other efforts to address the challenges facing the refining sector, including partnerships with foreign companies to revamp and modernize existing refineries. However, the success of these initiatives will depend largely on the political will to enforce policies and the continued commitment of private sector players like Dangote Refinery.
The reduction in petrol prices by Dangote Refinery is expected to bring some relief to Nigerians, particularly in light of the rising cost of living and the ongoing challenges of inflation. While the price cut is modest, it sends a positive signal that the government and local refineries are committed to stabilizing the sector and providing consumers with more affordable fuel.
