Petrol Price Jumps By N113/Litre As Dangote Ends Naira Sales

Private depot owners across Nigeria have increased the loading prices of Premium Motor Spirit (PMS), popularly known as petrol, and Automotive Gas Oil (AGO), also known as diesel, following Dangote Petroleum Refinery’s decision to discontinue naira-based sales and adopt a dollar-denominated pricing system.

The move has triggered fresh concerns over fuel costs, with petrol prices increasing by N113 per litre and diesel rising by N150 per litre as marketers rushed to adjust prices in response to the refinery’s new pricing template.

Market data obtained from industry sources showed that private depots in Lagos, Port Harcourt, and Warriimplemented significant price increases on Tuesday, reversing weeks of relative stability in Nigeria’s downstream petroleum sector.

The latest adjustments came less than 24 hours after Dangote Refinery officially began invoicing buyers of petrol, diesel, and Aviation Turbine Kerosene (ATK) exclusively in United States dollars, ending the naira-based pricing system introduced in October 2024 under the Federal Government’s naira-for-crude initiative.

Dangote Introduces Dollar-Based Fuel Pricing

Under the refinery’s revised pricing structure, ex-depot prices are now benchmarked at:

• Petrol (PMS): $0.779 per litre
• Diesel (AGO): $1.087 per litre
• Aviation Turbine Kerosene (ATK): $0.942 per litre

Coastal cargoes of petrol have also been priced at $1,044.62 per metric tonne.

In a notice issued to marketers, the refinery stated that all previously issued naira-denominated invoices and transaction summaries for gantry and coastal sales had been cancelled.

Customers were directed to process all future payments using the new dollar-based framework.

Marketers Factor In Currency Risk

Following the announcement, depot operators immediately reviewed their loading prices upward.

Industry players explained that the increases reflected not only the refinery’s switch to dollar sales but also the rising cost of sourcing foreign exchange in Nigeria’s volatile currency market.

Although the naira equivalent of Dangote’s benchmark—calculated at approximately N1,376 per dollar—remains broadly similar to previous ex-depot prices, marketers noted that additional increases reflected a currency-risk premium amid expectations of further naira depreciation.

Rising Oil Prices Add To Market Pressure

International oil prices also strengthened on Tuesday, adding further pressure to fuel pricing.

As of 10:00 p.m. WAT, Brent crude traded at $86.03 per barrel, representing a 3.28 percent increase, while West Texas Intermediate (WTI) rose 2.03 percent to $79.73 per barrel.

Industry analysts noted that while Dangote’s dollar pricing was the immediate reason for the latest depot adjustments, the continued rise in global crude oil prices could further influence fuel costs in the coming weeks.

Industry sources said the refinery’s decision followed increasing challenges associated with sourcing crude oil under the Federal Government’s naira-for-crude arrangement.

According to sources familiar with the refinery’s operations, crude allocations from the Nigerian National Petroleum Company Limited (NNPCL) have consistently fallen below the refinery’s processing capacity of approximately 650,000 barrels per day.

As a result, Dangote Refinery has increasingly relied on imported crude purchased in dollars while continuing to sell refined products in naira, creating growing foreign exchange exposure.

One source disclosed that the refinery has only been receiving a fraction of the crude volumes required each month under the existing arrangement, forcing it to source more supplies from the international market.

Energy experts have warned that the transition to dollar-based pricing could make Nigeria’s domestic fuel market more sensitive to fluctuations in the exchange rate.

They cautioned that any further depreciation of the naira may quickly translate into higher retail petrol prices, increased transportation costs, and additional inflationary pressure on consumers.

Neither the Nigerian National Petroleum Company Limited (NNPCL) nor the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) had responded to requests for comments at the time of filing this report.

Dangote Refinery has also not issued any public statement beyond the notice circulated to marketers, confirming that the new pricing structure takes immediate effect for all gantry and coastal fuel sales, excluding liquefied petroleum gas (LPG).