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Dangote Refinery Crashes Diesel Price | Citizen NewsNG

ByCitizen NewsNG

Apr 3, 2024


By Tanko Lami


Reports indicate that the $20 billion refinery commenced diesel distribution to the domestic market last Wednesday, offering a minimum of one million litres to each registered oil marketer since the beginning of its diesel sales.

Officials from the refinery and oil dealers have confirmed that the product was made available to marketers at prices ranging between N1,225/litre and N1,300/litre, depending on the purchase volume.

Additionally, there are indications that the refinery will commence the distribution of Premium Motor Spirit (petrol) in May this year.

Officials from the refinery and oil dealers have said that they sold the product to marketers for prices between N1,225 and N1,300 per liter, depending on the volume of purchase.

Simultaneously, reports indicate plans for the refinery to commence the distribution of Premium Motor Spirit to the domestic market in May this year.

“They started pumping out diesel to marketers since last week. They also promised to sell aviation fuel soon. Some of my members confirmed this to me after making the purchase,” the National President, Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi said.

He added, “So some of our marketers have started getting the product, but as an association we have not got the product yet, because we want to get the actual rate that it will be sold to us when we buy in bulk. However, they have started selling diesel because some of our marketers have started buying at N1,225/litre.

“They are selling at N1,225/litre and the minimum volume they are giving is one million litres per marketer. Also, they assured us that they will release more products, but for now this (diesel) is what they are starting with. So we are expecting them to release PMS anytime from now.”

Maigandi indicated that Dangote’s actions were expected to result in a sharp decline in diesel prices, especially considering that the commodity had recently reached a high of around N1,700 per liter.

“The price of diesel is going to fall because of the release of products from Dangote refinery. In fact, it is already coming down in Lagos,” Maigandi stated.

The Chief Executive of AF Ralph Oil and Gas Ventures, Dr. Ralph Arokoyo, corroborated Maigandi’s statement, noting the refinery’s initiation of diesel sales to dealers.

Arokoyo highlighted the positive effect of Dangote’s diesel sales on prices, which are anticipated to witness further reductions as more products from the refinery saturate the market.

Regarding the release of petrol, Arokoyo affirmed that Dangote refinery had communicated its plans to dealers, indicating an optimistic outlook as petrol remains a widely used fuel among Nigerians.

A senior official at Dangote refinery, speaking on condition of anonymity, confirmed the sale of diesel to marketers, Suggesting the upcoming availability of petrol in the market. The official expressed confidence that the availability of Dangote’s products would contribute to a reduction in fuel prices across the country.

Dangote refinery has encountered regulatory hurdles since its official inauguration by former President Muhammadu Buhari in May last year. However, recent developments indicate progress in the refinery’s efforts to supply refined products to the Nigerian market.

Reports from the PUNCH on February 8, 2024, revealed that regulatory approvals delayed the Dangote Petrochemical Refinery’s plan to sell aviation fuel (Jet A1) and diesel in the Nigerian market in January, even after setting a timeline of January 31.

The refinery struggled to overcome the hurdles of regulatory approvals, despite beginning production of refined petroleum products.

On January 12, 2024, the Dangote refinery announced the commencement of diesel and aviation fuel (JetA1) production.

Aliko Dangote expressed gratitude to President Bola Tinubu and other entities for their support in realizing the project, emphasizing the importance of regulatory approvals for the production of diesel and aviation fuel.

The refinery, Africa’s largest with a capacity of 650,000 barrels per day, aims to transform Nigeria from a fuel importer to a net exporter, potentially altering the dynamics of the industry.

Despite delays in local sales, the refinery initiated the export of diesel, marking its first refined product sale.

Reuters confirmed the export of two fuel cargoes, signaling the refinery’s transition to an exporter.

While diesel sales have commenced in Nigeria, the Independent Petroleum Marketers Association of Nigeria (IPMAN) Vice Chairman, Hammed Fashola, confirmed that IPMAN has yet to receive diesel allocations from the refinery.

However, Fashola expressed confidence in receiving allocations soon.

The introduction of Dangote’s diesel is expected to impact prices positively, potentially offering a cheaper alternative to imported diesel.

Despite no financial commitments made yet, independent marketers anticipate receiving allocations from Dangote this month. As of Tuesday, the pump price of diesel ranges from N1420 to N1500 in various locations.

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