Nigeria’s leading oil refinery, Dangote Refinery, has announced a new retail price for Premium Motor Spirit (PMS), commonly known as petrol, setting the nationwide price at N970 per liter. This decision comes amidst a sharp surge in global crude oil prices, a trend that typically translates to higher fuel costs for consumers.
While global crude oil prices have skyrocketed by 15 percent, impacting production costs, Dangote Refinery has absorbed a significant portion of this increase, limiting the impact on Nigerian consumers.
“We understand the burden rising petrol price can place on households and businesses,” said a spokesperson for Dangote Refinery in a statement. “Despite the substantial increase in our production costs, we have made a conscious effort to minimize the price hike for Nigerian consumers.”
The company recently adjusted its ex-depot price from N899.50 to N950 per liter, a far cry from the anticipated increase given the current global oil market conditions. Brent Crude oil prices have surged from $70 to $82 per barrel, further exacerbated by a premium of around $3 per barrel for Nigerian crude.
“If we were to pass the full increase in global oil prices onto the market,” the statement explained, “the retail price of PMS could have risen dramatically.”
However, Dangote Refinery has emphasized that the increase in the ex-depot price is significantly lower than the surge in global prices, reflecting its commitment to mitigating the impact on Nigerian consumers. The company also highlighted that the Single-Point Mooring (SPM) ex-vessel price has remained relatively stable, further contributing to its ability to limit the price hike.
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“At Dangote Refinery, we remain fully committed to providing Nigerians with top-quality, affordable fuel,” the spokesperson reiterated. “We believe that access to affordable energy is crucial for economic growth and social development.”
The company also expressed gratitude to the Nigerian government for its support of the domestic oil sector, particularly the Naira for Crude initiative. “This initiative has been instrumental in insulating Nigerians from the volatility of the international oil market,” the statement acknowledged.
To enhance transparency and build consumer trust, Dangote Refinery has announced that it will begin publishing its ex-depot, ex-vessel, and retail pump prices weekly. This move aims to prevent any potential exploitation by middlemen or marketers and ensure that consumers have access to accurate and up-to-date information regarding fuel prices.
This move by Dangote Refinery provides a much-needed respite for Nigerian consumers facing economic pressures. By absorbing a significant portion of the rising production costs, the company has demonstrated its commitment to social responsibility and its understanding of the critical role affordable energy plays in the lives of Nigerians.
