The Petroleum Products Retail Outlets Owners Association of Nigeria has raised concerns that Dangote Refinery’s plan to distribute diesel and petrol nationwide, starting August 15, could result in a hidden monopoly in the market.

Recall Dangote Refinery announced that it will start nationwide distribution of diesel and premium motor spirit, commonly called petrol, beginning August 15.

In a statement released on Monday by PETROAN’s National Public Relations Officer,

Joseph Obele, the association warned that the development could also lead to significant job losses in Nigeria.

“The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has raised concerns about Dangote Refinery’s forward integration adoption, warning that it could lead to a monopoly in disguise and pose a significant job loss threat to Nigeria.

“With a production capacity of 650,000 barrels per day, PETROAN argues that Dangote Refinery should be competing with global refineries, not operating as a distributor in the downstream sector.

“This massive refinery, one of the largest in sub-Saharan Africa, is expected to satisfy domestic fuel demand and export surplus products,” the statement reads.

PETROAN stated that Dangote Refinery’s adoption of the strategy could severely impact various stakeholders, including modular refineries, whose operations and market share may come under threat due to Dangote’s growing dominance.

According to the statement, PETROAN said it had previously raised concerns about Dangote’s intentions to dominate the downstream sector, warning that the company could use its market power to fix prices, stifle competition, and exploit consumers—“much like it has in other sectors.”

The association further cautioned that Dangote’s approach may involve a price penetration strategy—initially lowering prices to gain market share, with the ultimate aim of pushing other filling station operators out of the market.

“This could lead to a massive shutdown of filling stations across Nigeria, resulting in widespread job losses,” the statement reads.

The association further warned that Dangote Refinery’s plan to introduce 4,000 new compressed natural gas (CNG)-powered tankers poses a serious threat to the livelihoods of thousands of existing truck drivers and owners.

“While CNG trucks may offer a lower cost of transporting petroleum products, this shift could lead to widespread job losses in the industry,” PETROAN said.

It said Dangote Refinery’s strategy would have far-reaching effects on various stakeholders, especially modular refineries, whose operations and market share could be undermined by Dangote’s market dominance.

“Filling Station Operators: Many may be forced to shut down due to Dangote’s pricing penetration strategy and dominance.

“Local Suppliers of Petroleum Products: Their businesses may be negatively impacted by Dangote’s direct supply to end-users.

“Telecom Diesel Suppliers: Their operations and market share may be threatened by Dangote’s dominance.

“It is obvious that Dangote plans to gain full monopoly of the downstream sector, which would enable the company to exploit Nigeria’s petroleum consumers,” the statement reads.

According to the association, this development could result in higher fuel prices, reduced competition, and a decline in overall economic efficiency.