Dangote Petroleum Refinery has reduced the price of Premium Motor Spirit (PMS) to N899.50 per liter, a significant drop aimed at easing transportation costs during the holiday season.
This move, which takes immediate effect, underscores the impact of market deregulation in driving competition within Nigeria’s oil sector. It is coming a few days after the Nigerian National Petroleum Company Limited (NNPCL) reduced the retail price from N1,060 per liter at the pumps to N1,040, a reduction of N20 per liter.
The Dangote Refinery’s price reduction follows an earlier adjustment on November 24, 2024, when the refinery lowered the PMS price to N970 per liter.
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In a statement, Anthony Chiejina, Group Chief Branding and Communications Officer of Dangote Group confirmed the development while introducing an innovative offer that further benefits consumers.
Special Holiday Offer for Consumers
In addition to the price cut, Dangote Refinery announced a unique initiative to make fuel more accessible. Customers purchasing PMS on a cash basis will now be able to buy an additional liter on credit. This credit option is backed by bank guarantees from leading financial institutions, including Access Bank, First Bank, and Zenith Bank.
“To alleviate transport costs during this holiday season, Dangote Refinery is offering a holiday discount on PMS. From today, our petrol will be available at N899.50 per liter at our truck loading gantry or SPM. Furthermore, for every liter purchased on a cash basis, consumers will have the opportunity to buy another liter on credit,” Chiejina said.
The company expressed gratitude to Nigerians for their continued support and pledged to ensure the availability of high-quality petroleum products at competitive prices.
Deregulation Stirring Competition
This latest development highlights the growing competition in Nigeria’s downstream oil sector, driven by the government’s deregulation policy. With market forces now determining prices, private players like Dangote Refinery are responding dynamically to consumer demands and economic realities.
Energy analysts view this price reduction as a sign of increasing competition that could lead to more favorable pricing for Nigerians. It is believed that competition among market players like Dangote Refinery and NNPCL is pushing prices downward, with many saying they expect more price adjustments in the future as efficiency and economies of scale improve.
While the NNPCL’s adjustment reflects a modest N20 decrease, Dangote Refinery’s more substantial reduction to N899.50 places it ahead in the competitive race to attract consumers.
Chiejina emphasized Dangote Refinery’s commitment to providing Nigerians with high-quality, environmentally friendly petroleum products. The company’s operations signal an end to Nigeria being a dumping ground for substandard and blended imported products, which have historically posed significant risks to health, machinery, and the environment. Industry analysts say the development will also lead to massive decline in importation of more expensive petroleum products.
As Africa’s largest privately-owned refinery, Dangote Refinery has a production capacity of 650,000 barrels per day (BPD), making it the largest single-train refinery globally. The facility is designed to meet 100% of Nigeria’s refined petroleum product needs, with a surplus available for export.
The refinery is not only easing transportation costs but also fostering healthy competition in the sector, by aligning its pricing strategy with consumer needs and market realities.
As the festive season approaches, many have expressed the hope that this price reduction will bring significant relief to Nigerians, particularly in reducing transport expenses. With analysts predicting further price cuts in the future, the deregulated market may yield a more sustainable and consumer-friendly petroleum sector.