Nigeria’s energy landscape just saw a significant shift as Dangote Petroleum Refinery began selling Premium Motor Spirit (PMS), commonly known as petrol, directly to independent oil marketers.
This new strategy targets marketers capable of purchasing at least 250,000 liters, marking a departure from its earlier reliance on depot operators.
Previously, the refinery’s distribution depended largely on about 20 depot owners who lifted fuel from Dangote’s gantries and supplied it across the country.
By opening sales to independent marketers, the refinery is now bringing fuel closer to retail points, effectively bypassing the traditional depot system.
Why the Change Happened
Industry insiders say the shift is largely due to the breakdown of the old depot arrangement.
Jeremiah Olatide, CEO of Petroleumprice.ng, explained that Dangote opted to sell directly after the previous system “crashed.”
Olatide noted that fuel pricing was initially tied to Eurobob, the international benchmark for European gasoline.
Under this arrangement, prices would be adjusted periodically to reflect global market trends.
Initially, Dangote set a coastal rate of N806 per liter and a gantry price of N828 per liter.
Market Reactions and Price Adjustments
When international crude oil prices dropped, private depot owners pushed for a reduction in Dangote’s gantry price.
Although adjustments were made, they did not match the expectations of depot owners relative to global market rates.
This gap prompted many marketers to turn to fuel importation in November 2025, leading to a surge in imported fuel and a higher number of vessels at Nigerian ports.
Dangote Responds with a Major Price Cut
Observing the growing import trend and the market shift, Dangote Petroleum Refinery slashed its gantry price dramatically from N828 per liter to N699 per liter.
This 129-per-liter reduction became the largest price drop recorded in Nigeria for 2025, signaling the refinery’s determination to stabilize domestic supply and make local petrol more competitive.
What This Means for Fuel Distribution
By selling directly to independent marketers and lowering prices significantly, Dangote is reshaping Nigeria’s fuel distribution system.
This move could reduce reliance on imports, improve availability at retail outlets, and bring more transparency to pricing.
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