Consistent Price Cuts Ease Burden on Businesses
Dangote Petroleum Refinery & Petrochemicals has once again lowered the price of diesel, reducing it from N1,075 per litre to N1,020 per litre. This move aims to support businesses and consumers by making fuel more affordable.
Since launching diesel production in January 2024, the refinery has consistently reduced prices, dropping from an initial N1,700 per litre to the current rate. This series of reductions has provided much-needed relief to industries and households struggling with high energy costs.
Dangote’s Contribution to Price Stability
The latest price cut follows revelations by Ken Ife, a development economist, who highlighted Dangote Refinery’s role in ensuring stable fuel prices during the yuletide season. According to him, the refinery absorbed over N10 billion in costs to keep fuel prices uniform across Nigeria, preventing artificial scarcity and price hikes.
Ife commended the refinery for setting a new benchmark in the nation’s energy sector. He noted that its efforts are not only stabilizing local fuel prices but also unlocking new export opportunities for Nigeria.
The Equalisation Fund and Its Growing Challenges
For years, the Petroleum Equalisation Fund has managed price differences and covered transportation costs to ensure uniform pricing nationwide. However, reports indicate that the fund currently owes marketers over N80 billion, leaving the fuel market vulnerable to fluctuations.
Shift in Subsidy Burden to the Private Sector
“The president has shifted the subsidy burden from public funds to the private sector. If petroleum is to be sold at a uniform price nationwide, transportation costs must be addressed. That’s where the equalisation fund comes in. However, with a debt of around N80 billion, the system is under strain,” Ife explained in an interview with Arise TV.
He pointed out that during past Christmas seasons, fuel shortages, hoarding, and price hikes were common, leading to increased food and transport costs. To prevent this, the Dangote Group stepped in and absorbed the price differences, effectively playing the role of a subsidy provider.
Nigeria’s Growing Influence in the Global Petroleum Market
Beyond local price stability, the refinery is driving Nigeria toward a more diversified petroleum industry. Ife emphasized that the country is gradually shifting from its heavy reliance on Premium Motor Spirit (PMS) and expanding into a broader range of refined products.
Foreign Investors Show Interest in Nigerian Petroleum
With global energy giants such as BP and Saudi Aramco purchasing refined products from Nigeria, the country is fast emerging as a key player in the international petroleum market. Analysts believe Nigeria is on track to achieving self-sufficiency in petroleum products while strengthening its position as a major exporter.
