…As Dangote Refinery Cuts Price by N100 as Oil Prices Ease
By Peter Salami
Oil marketers have warned Nigerians to brace for a possible rise in the pump price of Premium Motor Spirit (PMS), commonly known as petrol, to about N1,500 per litre if the ongoing conflict involving Iran, Israel, and the United States continues to disrupt global oil supply.
The warning was issued by the National President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Billy Gillis-Harry, during an appearance on a television programme on Tuesday.
Gillis-Harry said volatility in global oil prices triggered by the Middle East conflict could push domestic petrol prices significantly higher, noting that a pump price of N1,500 per litre was increasingly becoming a realistic possibility.
“The reality is that if you look at the volatility in the price from what we are seeing today, the Dangote Petroleum Refinery is the salvation for us, due to the consistent source of product, which is much more important at this time than anything,” he said.
According to him, the steady supply from the refinery, even at higher prices, remains preferable to fuel scarcity.
“The availability of products is much more important than pricing. The pricing we predicted has risen above N1,000 per litre the other time to N1,175 at the gantry. By the time we add the charges, logistics, and others, the price will get higher and higher. So, yes, N1,500 per litre is not far-fetched,” he said.
He added that Nigerians should focus on ensuring energy security rather than panicking over rising prices.
“It should not make us panic. It is better for us to have the product available, be able to do our business, and get some level of energy security than not having it,” he said.
The warning comes amid rising global crude oil prices linked to escalating tensions in the Middle East, which have pushed energy prices higher than expected.
On Monday, the Dangote Petroleum Refinery had earlier revised its ex-depot petrol price upward to N1,175 per litre, while the price of Automotive Gas Oil (diesel) was raised to N1,620 per litre. The increase marked the fourth price adjustment within two weeks, reflecting volatility in the international oil market.
Under that structure, petrol rose from N995 per litre, while diesel jumped from N1,430 per litre, highlighting the upward trend in domestic fuel prices.
The price surge coincided with a spike in international crude benchmarks. As of Monday afternoon, Brent Crude traded at about $102.8 per barrel, while West Texas Intermediate stood at roughly $101.0 per barrel.
The situation created ripple effects across Nigeria’s downstream petroleum sector as depot operators and marketers adjusted supply costs in response to the refinery’s revised prices.
Global oil prices had surged by about 30 per cent earlier in the week amid fears of supply disruption as the war entered a second week with no immediate signs of resolution. Since the conflict began, WTI crude had climbed more than 75 per cent while Brent crude had risen by over 60 per cent.
Speaking earlier at a press conference, the Managing Director and Chief Executive Officer of the Dangote Petroleum Refinery, David Bird, explained that although Nigeria introduced a crude-for-naira policy to enable local refineries to purchase crude in local currency, the commodity remains priced based on international benchmarks.
He noted that the refinery continues to buy Nigerian crude at global market rates and therefore does not benefit from discounted supplies.
Meanwhile, Donald Trump, President of the United States, said his administration may temporarily waive some oil-related sanctions in an attempt to stabilise global supply and reduce prices amid the conflict.
“We’re also waiving certain oil-related sanctions to reduce prices,” Trump said after talks with Russian President Vladimir Putin, adding that discussions also involved Chinese leader Xi Jinping.
The US-Israel strikes on Iran and Tehran’s retaliatory attacks across the Gulf have disrupted global energy and transport sectors, including activities around the Strait of Hormuz, a critical maritime route through which about one-fifth of the world’s oil supply passes.
However, global oil markets showed signs of easing on Tuesday as crude prices dropped to about $90 per barrel, the first decline since the conflict began, following signals of possible de-escalation.
Reflecting the slight easing in global prices, the Dangote Petroleum Refinery announced on Tuesday a reduction in its ex-gantry petrol price by N100, bringing the price down from N1,175 to N1,075 per litre.
According to the refinery’s latest pricing template, petrol supplied through coastal distribution channels will now sell at N1,050 per litre.
The refinery also reduced the price of diesel to N1,430 per litre, representing a N190 drop from the earlier price of N1,620 per litre.
The company explained that the quoted gantry prices exclude statutory charges imposed by the Nigerian Midstream and Downstream Petroleum Regulatory Authority.
The latest adjustment marks the first price cut after three consecutive increases recorded earlier in the month, when petrol prices rose from N874 per litre to N995 and later to N1,175 per litre.
Industry analysts say while the temporary price drop may offer slight relief to marketers and consumers, continued geopolitical tensions in the Middle East could still push global oil prices higher, with potential knock-on effects on petrol prices in Nigeria.