Nigerian billionaire Aliko Dangote, owner of the $20 billion Dangote Refinery, has explained the reasons behind the recent reduction in fuel prices across the country.
After months of rising costs, Nigerians saw some relief during the festive season as Premium Motor Spirit (PMS) prices dropped significantly.
Speaking during an interview on Nigerian television channel, Arise TV, Dangote attributed the price reduction to market dynamics rather than a deliberate effort by fuel marketers to ease economic pressures during the holidays.
“The price reduction is a response to the market, let me just put it that way,” he said. “It is a refinery where we invested over $20 billion, and I think we have to try and protect our interests and also our investments.”
On December 19, the Dangote Refinery announced a reduction in its ex-depot price of petrol to N899.50 per liter. This move triggered fierce competition in the downstream industry, prompting the Nigerian National Petroleum Corporation Limited (NNPCL) to lower its own ex-depot price to N899 per liter.
In addition, the Dangote Refinery partnered with MRS fuel stations to sell petrol at N935 per liter at retail outlets across the country, much to the delight of commuters.
During the interview, Dangote also addressed the impact of petroleum imports on Nigeria’s foreign exchange reserves, emphasizing the need to reduce reliance on imports.
“Forty percent of our demand on foreign exchange is through people dealing in petroleum products,” he said. “The more we allow imports to come in, not because I do not want imports but the more we allow imports, the more we keep using most of our foreign exchange out of the country because the majority of those letters of credit open for petroleum products and the goods are not coming into Nigeria.”
The price reduction coincided with the festive season, a period characterized by increased interstate travel. To further ease transportation costs, Dangote Group introduced special offers for consumers.
“To alleviate transport costs during this holiday season, Dangote Refinery is offering a holiday discount on PMS,” said Anthony Chiejina, Group Chief Branding and Communications Officer for Dangote Group.
“From today, our petrol will be available at N899.50 per liter at our truck loading gantry or SPM,” he added. “Furthermore, for every liter purchased on a cash basis, consumers will have the opportunity to buy another liter on credit, backed by a bank guarantee from Access Bank, First Bank, or Zenith Bank.”
The Dangote Refinery, the largest single-train refinery globally with a capacity of 650,000 barrels per day, is designed to meet Nigeria’s domestic demand for refined petroleum products while producing surplus for export.
This strategic move underscores the refinery’s role in driving market competitiveness and highlights its potential to ease Nigeria’s foreign exchange challenges. For Nigerians, the reduction in fuel prices comes as a welcome respite during a season traditionally marked by high transportation costs.
