Story Highlights:
- The recent hike in petrol prices by NNPC has intensified the strain on Nigerians, leaving many to wonder why prices remain high despite local refining.
- A back-and-forth between Dangote Refinery and marketers oversupply costs has added to the confusion, with each side pointing fingers at pricing and quality.
- Meanwhile, consumers face long queues and rising costs, struggling to afford fuel as the stand-off continues.
The recent petrol price hike by the Nigerian National Petroleum Corporation (NNPC) Limited has taken a toll on Nigerians, particularly commuters and motorists nationwide.
Many are now asking why the much-anticipated Dangote refinery hasn’t brought down fuel prices.
They are wondering still facing scarcity and high costs, even with locally refined petrol available for the first time.
Meanwhile, the management of the Dangote refinery and local fuel marketers are now clashing over pricing and availability.
Aliko Dangote, CEO of the 650,000 barrels per day (bpd) refinery, insists that there is no shortage and that sufficient petrol is available for marketers. He revealed that his Lagos-based refinery currently holds 53 million liters of petrol.
Speaking during a recent meeting at the State House with the president and top officials, Dangote said,
“I’m expecting either NNPC or marketers to stop importing and come to collect. We have what they need. As they take it, I’ll keep pumping. Do you know what it costs to hold millions of liters in storage? I’m losing money. If I could collect the naira today, I’d charge someone 32% interest. Right now, that’s my loss on 500 million liters.”
Meanwhile, marketers, represented by groups like the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Petroleum Retail Outlet Owners Association of Nigeria (PETROAN), have hinted that relying solely on Dangote might push prices even higher.
For instance, Dr. Joseph Obele, PETROAN’s Publicity Secretary, stated last Wednesday that imported fuel would arrive at around N800 per liter, adding, “PETROAN will sell for far less than Dangote’s price and even lower than NNPC’s.”
Dangote, however, responded by arguing that such pricing defies market realities in a deregulated environment, suggesting that only substandard fuel could be sold so cheaply.
Consumers Caught in the Crossfire
Amid the back-and-forth between Dangote and marketers, it’s everyday Nigerians who are suffering the most, waiting in long lines and paying a premium price for fuel.
Emeka Ugonna, an Uber driver, expressed his frustration, “We don’t care how the fuel is sourced. All we know is prices can’t keep going up like this. The government needs to step in. They promised that the Dangote refinery would lower prices, yet we’re paying more.”
Similarly, Michael Okechukwu, another motorist, has resorted to using public transport because he can no longer afford to fuel his car.
“One day it’s N1,200; the next day, N1,500, then N2,000. I had to park my car. I can’t spend all my money on fuel,” he said.
Public transportation users are feeling the pinch as well.
Seun Onifade, a nurse commuting from Abule Egba to her job in Gbagada, described her financial strain:
“Now, you spend all your money on transport and the rest on food. Saving is out of the question.”
She and her husband are considering moving closer to her workplace, but housing in those areas is costly.
“We’re stuck between a rock and a hard place. That’s our reality post-subsidy removal,” she said.
The bigger picture: subsidy removal and deregulation
Removing subsidies and deregulating the market can bring certain benefits, but lower prices aren’t necessarily one of them.
Energy expert and consultant, Adewale Oginni, pointed out that while prices may stabilize long term, the immediate effect is a financial strain on consumers.
“Nigeria relies heavily on petrol—for vehicles, businesses, even home generators. Removing subsidies has consequences—market prices rarely favour the consumer,” he noted.
Human rights lawyer Barrister Isaac Ishaku believes Nigerians should hold both the federal government and Dangote accountable for high petrol prices. He argued that price hikes allow Dangote to prioritize profit over consumer welfare.
“They’re all in on it—Dangote and the government. With subsidies gone, the private sector profits, while Nigerians lose out on their crude oil benefits despite the crude being owned by the masses,” Ishaku alleged.
It’s worth noting, however, that deregulation has been on the horizon since the Petroleum Industry Act (PIA) was enacted, promoting a willing buyer/willing seller model for fuel sales.
Ayodele Oni, a senior partner at Bloomfield Law, stated that deregulation, though contentious, encourages investment and competition.
“Contrary to what some people believe, deregulation allows for fair play. Dangote can come in and sell his petrol at a price he believes will be attractive and then the marketers also can choose to patronize him or source petrol abroad, or both,” Oni said.
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