Amanze Chinonye
Dangote Refinery has reduced the ex-depot price of Premium Motor Spirit (PMS), popularly known as petrol, by N50 per litre to N1,075 per litre, marking its fourth downward price review in one month and signalling that further reductions could follow as lower-cost crude oil enters its production cycle, Prime Business Africa reports.
The latest adjustment brings the cumulative reduction in the refinery’s ex-depot petrol price to over N200 per litre since May 30, 2026, reinforcing a downward trend in domestic fuel prices that could provide further relief to consumers and businesses if global oil market conditions remain favourable.
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Dangote Refinery Cuts Petrol Ex-Depot Price by ₦50 to ₦1,125/Litre
In a statement issued on Thursday, the refinery said the latest price cut reflects its commitment to passing cost efficiencies on to consumers while maintaining the operational and financial sustainability of domestic refining.
The company, however, clarified that its pricing model is not driven by daily movements in international crude oil prices. Rather, it said prices are based on actual production costs and the cost of crude oil inventories, noting that crude is typically purchased weeks and, in some cases, months before it is refined under commercial contracts linked primarily to monthly average pricing mechanisms.
The clarification comes amid growing public expectations that petrol prices should immediately mirror recent declines in global crude oil prices.
According to the refinery, the petroleum products currently being supplied are still being refined from crude acquired when international oil prices were significantly higher than current levels.
It disclosed that the average landed cost of crude processed was approximately $124.80 per barrel in May and $95.25 per barrel in June, compared with the current international benchmark of about $71.01 per barrel.
Dangote Refinery also explained that its feedstock is purchased on a Dated Brent-plus basis, which includes market premiums, freight and logistics costs, rather than at the headline ICE Brent benchmark price commonly reported in the media. As a result, its actual landed costs are materially higher than benchmark quotations.
Despite the elevated feedstock costs, the refinery said it chose to absorb a substantial portion of the increase instead of immediately transferring the full burden to consumers. It said the decision was aimed at supporting market stability, easing inflationary pressures and shielding Nigerians from the volatility of the global energy market.
The company added that fuel prices in Nigeria remain lower than those in neighbouring countries, even after accounting for taxes.
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Beyond petrol, the refinery said it has reduced the ex-depot price of Automotive Gas Oil (AGO) by N300 per litre and Jet A1 aviation fuel by N520 per litre since May 30.
It noted that the latest reduction marks the beginning of a phased pricing adjustment as lower-cost crude cargoes gradually replace higher-priced inventories in its refining cycle.
“As procurement costs continue to decline and lower-priced inventories replace higher-cost crude stocks, Nigerians can expect further price moderation, provided international market conditions remain favourable,” the statement said.
The refinery maintained that its pricing decisions will continue to be guided by production economics and inventory costs rather than short-term fluctuations in international oil markets.
It also highlighted the broader significance of domestic refining, stating that its current production capacity is sufficient to meet Nigeria’s fuel demand, reduce dependence on imported petroleum products, conserve foreign exchange, strengthen energy security and improve price stability for households and businesses.
The latest announcement is expected to reinforce competition in Nigeria’s downstream petroleum market and could place additional pressure on fuel marketers to adjust pump prices as lower ex-depot costs gradually filter through the distribution chain.
Amanze Chinonye is a Staff Correspondent at Prime Business Africa, a rising star in the literary world, weaving captivating stories that transport readers to the vibrant landscapes of Nigeria and the rest of Africa. With a unique voice that blends with the newspaper's tradition and style, Chinonye's writing is a masterful exploration of the human condition, delving into themes of identity, culture, and social justice. Through her words, Chinonye paints vivid portraits of everyday African life, from the bustling markets of Nigeria's Lagos to the quiet villages of South Africa's countryside . With a keen eye for detail and a deep understanding of the complexities of Nigerian society, Chinonye's writing is both a testament to the country's rich cultural heritage and a powerful call to action for a brighter future. As a writer, Chinonye is a true storyteller, using her dexterity to educate, inspire, and uplift readers around the world.
