In a response to mounting pressure from oil marketers, the Dangote Petroleum Refinery has announced a reduction in the price of Automotive Gas Oil (diesel) from N1,200/litre to N1,000/litre, sparking enthusiasm among players in the downstream oil industry.
The refinery’s spokesperson, Tony Chiejina, disclosed the price adjustment in a statement issued on Tuesday, signaling a proactive step towards addressing market demands.
Chiejina’s statement highlighted the refinery’s commitment to driving economic impact, stating, “In an unprecedented move, Dangote Petroleum Refinery has announced a further reduction of the price of diesel from N1,200 to N1,000/litre.”
The reduction, initially rolled out at N1,200/litre three weeks ago, represents a significant drop of over 30 per cent from the previous market rate of approximately N1,600/litre, according to the statement. The move is anticipated to have a ripple effect across the economy, contributing to the reduction of the prevailing high inflation rate in Nigeria.
The decision comes in response to calls from oil marketers, who advocated for a downward review of diesel prices to between N700 and N850/litre. Reacting to the announcement, industry stakeholders expressed optimism about the potential benefits of increased competition in the downstream sector.
Mohammed Shuaibu, Secretary of the Independent Petroleum Marketers Association of Nigeria, Abuja-Suleja Branch, welcomed the development, stating, “This is a welcome development… Such competition would create room for more price reduction and we are going to start seeing the positive impact on the cost of goods and services in the long run.”
Similarly, Clement Isong, Executive Secretary of the Major Energies Marketers Association of Nigeria, expressed enthusiasm, saying, “I have not heard about it yet. But I will be excited if it is true. It is good news.”
The calls for a price reduction stemmed from concerns raised by industry bodies such as IPMAN and the Petroleum Products Retail Outlets Owners Association of Nigeria, who urged the refinery to consider the high cost of logistics involved in transporting the product. They emphasized that diesel produced domestically should be priced competitively compared to imported variants, considering the absence of vessel costs and import charges.
The move by Dangote Petroleum Refinery to slash diesel prices underscores a collaborative effort towards addressing market demands and promoting economic growth within Nigeria’s downstream oil sector.
