KEY POINTS
- PETROAN claims imported petrol costs less than Dangote’s ₦990/litre.
- PETROAN plans to sell petrol at lower prices, challenging Dangote’s monopoly.
- PETROAN urges the privatization of government refineries to enhance competition.
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has criticized Dangote Petroleum Refinery for selling petrol at ₦990 per litre, describing the price as “inconsiderate” given the concessions the company received during its construction. PETROAN emphasized that imported petrol is cheaper, with the landing cost of imported fuel being ₦978 per litre as of October 31, 2024.
Joseph Obele, the Publicity Secretary of PETROAN, stated that the association is prepared to sell petrol at a lower price once granted an import license by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). PETROAN has formed a strategic business unit called PETROL to spearhead its importation efforts and aims to offer more affordable prices than the current market rate.
Dangote refinery defends price amid monopoly accusations
In response, Dangote refinery raised concerns that PETROAN and the Independent Petroleum Marketers Association of Nigeria (IPMAN) plan to import substandard petroleum products. However, Obele dismissed these allegations, accusing Dangote of attempting to maintain a monopoly in the Nigerian fuel market. He insisted that competition is crucial for fair pricing and consumer protection.
“The rate of ₦990 as announced by Dangote refinery was inconsiderate, especially considering the significant foreign exchange concessions the company enjoyed during its construction,” Obele stated. He added that Dangote’s pricing strategy should be based on production costs plus a fair margin, rather than international market rates.
Obele further claimed that PETROAN has made arrangements with foreign partners to import high-quality petrol at lower costs, with plans to enter the market by December 2024.
PETROAN commends Tinubu, calls for privatization of government refineries
PETROAN also commended President Bola Tinubu for his efforts to rehabilitate Nigeria’s state-owned refineries, particularly the ongoing projects in Port Harcourt and Warri. The association called for the immediate privatization of these refineries to ensure their long-term efficiency and competitiveness in the market. Obele suggested that reputable firms, in partnership with PETROAN and other stakeholders, should take over the refineries to ensure they can compete with private players like Dangote.
Obele concluded by calling for a balanced and competitive market, stating that monopolistic practices in the oil sector would only harm consumers by driving up prices. PETROAN vowed to support the federal government in achieving greater competition in the downstream sector, ensuring Nigerians benefit from lower fuel costs.
