Marketers Turn to Foreign Traders as Petrol Prices Remain High

Petroleum marketers in Nigeria have begun talks with international fuel traders to import cheaper Premium Motor Spirit (PMS), in a bid to stay competitive amid fluctuating local prices. This development comes as pressure mounts on the Dangote Petroleum Refinery to reduce its ex-depot price, which currently hovers around ₦825 per litre.

Both the Independent Petroleum Marketers Association of Nigeria (IPMAN) and oil workers have questioned why locally refined fuel remains expensive. They argue that the Dangote refinery should offer a more affordable rate, especially given the elimination of import-related costs.

Speaking with reporters, Billy Gillis-Harry, President of the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), revealed that negotiations with foreign traders are ongoing. According to him, the only path to affordable fuel lies in direct partnerships with dependable importers.

“We’re not refining ourselves, and those who are refining are setting prices that are difficult to work with,” Gillis-Harry said. “That’s why so many filling stations are shut. The capital required to operate has disappeared. Our solution is collaboration—buying from reliable foreign sources, preferably in naira.”

He disclosed that PETROAN previously negotiated with international traders to import petrol at ₦550 per litre in naira, as far back as November 2024. Gillis-Harry insisted such agreements are possible through collective bargaining power and large-volume purchases.

He also emphasized the instability of local pricing, pointing out that price fluctuations from ₦825 to ₦870 and back down to ₦865 make it difficult for marketers to operate sustainably. Though he refrained from singling out Dangote, he questioned the viability of a pricing model that creates volatility for businesses.

“Dangote is a businessman and is doing what he deems fit. But business is more than just setting a price. There are operational costs, transaction risks, and financing challenges,” he explained.

Talks with the foreign suppliers are still active, according to Gillis-Harry, who also claimed that some local refiners, though not yet operational, show promise. He expressed hope that Nigeria’s refining landscape could improve if more competition enters the market.

Gillis-Harry further criticized Dangote’s decision to begin direct fuel distribution nationwide, warning it could lead to job losses among independent marketers and tanker operators.

IPMAN’s Publicity Secretary, Chinedu Ukadike, also shared concerns. He stated that some importers already sell fuel at prices lower than Dangote’s, despite absorbing international logistics and tax costs. Ukadike argued that if Dangote’s operation bypasses these expenses, its pricing should be even more competitive.

“The deregulation of the fuel market should lead to a price war, where supply and demand determine the true market price,” Ukadike said. “But what we see is an artificial monopoly, largely because government-owned refineries are not working.”

Ukadike asserted that Nigeria’s failure to revive its refineries has allowed Dangote to dominate pricing. He suggested that if NNPC-operated refineries sold petrol at ₦600, Dangote would be forced to reduce his price to compete.

Despite the concerns, he acknowledged that the Dangote refinery had addressed Nigeria’s long-standing fuel scarcity. “There is product availability now. Dangote has enough reserves to sustain Nigeria for 60 days. That’s commendable,” Ukadike added.

In response to allegations of monopoly, Dangote Refinery dismissed the claims, saying its plan to distribute fuel directly to filling stations would lead to lower pump prices, reduce inflation, and generate employment. The company reiterated its commitment to ensuring fuel accessibility across the country.