Dangote slashes petrol price in response to market forces

The President of Dangote Industries Limited, Aliko Dangote, has explained that the recent reduction in the ex-depot price of Premium Motor Spirit (PMS), also known as petrol, to ₦899.50 per litre at the Dangote Refinery’s loading gantry was primarily influenced by market dynamics.

During an interview featured in an Arise TV documentary, Dangote emphasized his commitment to safeguarding both the interests and investments of the multibillion-dollar company.

He stated, “The price reduction is a response to the market, let me put it that way. This is a refinery where we’ve invested over $20 billion, and we must protect our interests and investments.”

On December 19, 2024, the Dangote Refinery reduced its petrol ex-depot price from ₦970 to ₦899.50 per litre, sparking competitive pricing within the downstream sector. This led the Nigerian National Petroleum Company Limited (NNPCL) to lower its ex-depot price to ₦899 per litre.

Additionally, the refinery partnered with MRS petrol stations to sell petrol at ₦935 per litre nationwide, receiving positive reactions from Nigerians.

Dangote highlighted the transformative potential of the 650,000-barrels-per-day refinery for Nigeria’s oil sector and economy, noting that it would reduce pressure on foreign exchange caused by importing petroleum products. He explained, “About 40% of foreign exchange demand is tied to petroleum product imports.

Allowing more imports depletes our foreign exchange reserves because the majority of letters of credit for petroleum products involve payments to suppliers outside Nigeria.”

Addressing criticisms, Dangote said, “Criticism is inevitable, but it won’t deter us. No one in Nigeria’s history has invested $20 billion in a single project over the last 100 years.

I undertook this project out of patriotism and my desire to leave a lasting legacy.” He also remarked, “If I had invested this money in Google or Apple, the returns would be higher, and I wouldn’t face the challenges I do now. But my love for my country motivated me to invest here.”

Dangote dismissed claims that the NNPC provided financial assistance of $1 billion to address liquidity issues at the refinery, describing such allegations as “cheeky and untrue.”

He clarified that while NNPC initially intended to invest $1 billion in the refinery, the amount was insignificant in the context of the $20 billion project.

Vice President of Dangote Industries Ltd., Devakumar Edwin, also shared that the refinery is currently refining 350,000 barrels of crude oil per day, with plans to scale up to its full capacity of 650,000 barrels per day.

He assured that Nigeria’s crude oil production far exceeds the refinery’s requirements, ensuring an adequate supply for its operations.