The Dangote Petroleum Refinery will incur an estimated N32.5 billion loss following a recent reduction in the ex-depot price of Premium Motor Spirit, also known as petrol.
The refinery, which had accumulated over 500 million litres of petrol at a retail price of N890 per litre, initially valued its stock at N445 billion. However, a N65 cut in the ex-depot price — lowering it from N890 to N825 per litre on February 27, 2025 — has reduced the projected revenue from this stock to N412.5 billion.
This marks the second price slash by the refinery in February, following an earlier N60 reduction earlier in the month.
In a statement released in February, Dangote Refinery emphasized its commitment to easing the financial burden on Nigerians.
“It is important to note that Dangote Petroleum Refinery has consistently lowered the prices of petrol and other refined products for the benefit of Nigerians,” the statement read.
The refinery also highlighted a previous reduction during the December 2024 festive season, when PMS prices were cut by N70.50 — from N970 to N899.50 per litre — to cushion the usual holiday fuel price spikes.
Despite the revenue setback, industry experts suggest that falling crude oil prices and a slight appreciation of the naira against the dollar may help offset Dangote Refinery’s losses.
However, the price cuts have sparked concern among fuel importers and marketers, who claim their profit margins are shrinking. Some importers estimate combined losses of N2.5 billion daily and N75 billion monthly due to the latest price reduction.
Marketers holding old stock have also reported financial setbacks, as many filling stations have adjusted their pump prices to remain competitive.
Checks by The PUNCH confirmed that several filling stations, including NNPC retail outlets in Lagos, have lowered their pump prices to N860 per litre in response to the refinery’s new pricing.
While consumers have welcomed the price cuts, many are urging Dangote Refinery to expand its distribution network by increasing the number of filling stations nationwide.
Meanwhile, projections by the Major Energies Marketers Association of Nigeria suggest petrol prices could drop further to around N800 per litre, with the current landing cost estimated at N783.66 per litre.
