Our Correspondent, Lagos
A new wave of competition has gripped Nigeria’s petroleum downstream sector, as independent marketers and fuel importers slash petrol prices below the levels offered by the Dangote Petroleum Refinery. The move has intensified the battle for market share and reopened a sensitive debate about the role of importation in a supposedly liberalised fuel market.
Investigations by The PUNCH revealed that several filling stations in Lagos and Ogun States are now retailing petrol for as low as ₦847 per litre—below the ₦865 to ₦875 range offered by Dangote-affiliated marketers such as MRS and Heyden. Depot sales have also dipped, with some importers selling ex-depot prices at ₦815 per litre, undercutting the ₦820 offered by the 650,000-barrels-per-day Dangote refinery.
Industry insiders say the move is a survival tactic by importers, many of whom have suffered losses since Dangote began offering competitive pricing earlier in the year. Now, with Dangote calling for a ban on fuel importation, the pricing standoff may well shape the next chapter in Nigeria’s refining and fuel supply narrative.
Dangote’s Dilemma: Refining Versus Importing
At the centre of the controversy is Alhaji Aliko Dangote, Africa’s richest man and the promoter of Nigeria’s most ambitious refining project. During a recent industry event organised by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in Abuja, Dangote openly criticised the ongoing importation of fuel into Nigeria, describing it as “killing local refining” and discouraging much-needed investment in the sector.
“The importation of fuel into Nigeria is killing local refining. We are now facing increased dumping of cheap, often toxic petroleum products,” Dangote said, warning that such competition risks rendering domestic production unviable.
He further alleged that discounted or subsidised fuels—particularly from Russia—are being offloaded into African markets at below-market rates, citing global examples where domestic industries are shielded from such threats.
“This has created an unlevel playing field in most African countries… Petrol and diesel are sold for about a dollar net of taxes elsewhere. In Nigeria, this price is just about 60 cents—cheaper than Saudi Arabia,” he added.
Liberalisation or Protectionism?
Dangote’s remarks come at a time when the Nigerian government has touted market liberalisation as central to its economic reform strategy. The President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, pushed back strongly against Dangote’s proposal, arguing that banning fuel imports would distort the very liberalisation the government claims to support.
“This is the beauty of market liberalisation,” Ukadike said. “That is why we opined that the President should not ban anybody from importing petroleum products. Opening up the market ensures competitive pricing.”
Ukadike added that importers are responding to market dynamics and not acting out of malice. “Depot owners are dropping their petrol prices. Some are selling at ₦815, while Dangote is at ₦820. NNPC is still at ₦825,” he noted.
The IPMAN spokesman also addressed concerns about substandard or toxic fuels, assuring that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has mechanisms in place to monitor and prevent such products from entering the market.
The Policy Crossroads: ‘Nigeria First’ or Market First?
The tug-of-war reflects broader tensions in Nigeria’s economic strategy: should the country protect strategic domestic industries at the risk of reduced competition, or should it double down on liberalisation to attract efficiency and price benefits?
Dangote’s call for a ‘Nigeria First’ policy to extend to petroleum products—akin to import bans or restrictions—echoes protectionist tendencies seen in sectors like agriculture and manufacturing. He has urged the government to adopt policies similar to those in the United States, Canada, and the EU, where local producers enjoy regulatory buffers against unfair global pricing.
However, critics argue that Nigeria lacks the institutional strength to implement such safeguards effectively. Furthermore, given past experiences with monopolies and subsidy regimes, they warn that insulating the domestic refining industry could backfire, leading to inefficiencies and higher prices for consumers.
A New Chapter for Nigeria’s Fuel Market
Since the removal of fuel subsidies in 2023, the Federal Government has insisted that deregulation would pave the way for a competitive and more efficient downstream sector. The entry of the Dangote Refinery was seen as a turning point—a promise of local supply, reduced import dependency, and improved fuel security.
However, as marketers push prices below Dangote’s cost, the reality is proving more complex. The tension between local refining and import-driven competition could either reinforce the liberalisation framework or force the government into a new era of strategic protectionism.
The coming months may well determine the true direction of Nigeria’s energy policy. Will the country double down on free market principles, or will it heed the call to shield indigenous giants like Dangote?
For now, one thing is clear: Nigeria’s fuel market is no longer business as usual.