Dangote Petroleum Refinery has reduced the price of Premium Motor Spirit by N25, nine days after increasing its ex-gantry price by N85. The new price of N1,325 per litre was announced in a recent update. This move comes as international crude prices have started to retreat. The price cut is a significant development in the Nigerian fuel market, where prices have been fluctuating in recent times.
The decline in international crude prices is attributed to renewed expectations of diplomatic engagement between the United States and Iran. This has eased some of the pressure on the international oil market. Brent crude was trading at $100.40 per barrel, down 3.34 percent, while West Texas Intermediate stood at $92.40, down 3.83 percent at the latest market update. The movement in crude prices is expected to have a ripple effect on the domestic fuel market.
Dangote had previously raised its petrol price from N1,265 to N1,350 per litre on September 12, adding N85 to the cost of the product at the refinery. The latest price reduction brings the price closer to the levels before the initial increase. The refinery's price benchmark has a significant impact on the wholesale petrol prices in the coastal market.
Petrol prices at coastal depots have moved closer to Dangote's new benchmark. According to data from Petroleumprice.ng, petrol is selling at N1,330 per litre at monitored depots in Warri and Port Harcourt. Similarly, depots in Calabar quoted N1,327 per litre. The narrowing gap between Dangote's price and the prices at coastal depots highlights the close link between the refinery's benchmark and wholesale petrol prices.
The prices at various depots in Warri and Port Harcourt are as follows: Keonamex, Sharon and Prudent depots in Warri sold at N1,330 per litre, while Masters and TSL in Port Harcourt also quoted N1,330. In Calabar, Alkanes, Mainland and Sobaz quoted N1,327 per litre. However, Lagos prices remained higher, with Integrated and Ascon depots quoting N1,351 per litre.
The latest prices put most of the monitored coastal depots within N2 to N5 of Dangote's new N1,325 ex-gantry price, while the Lagos market was N26 higher. The direction of crude prices, alongside domestic supply and competition among refiners and marketers, will remain key to petrol pricing in the coming weeks. The fuel market is expected to continue to respond to changes in the international oil market.
The development is significant for the Nigerian fuel market, where prices have been fluctuating in recent times. The Dangote refinery's price benchmark has a significant impact on the wholesale petrol prices in the coastal market. The market is expected to continue to watch the developments in the international oil market and their impact on domestic fuel prices.
Key points
- Dangote Petroleum Refinery cuts petrol price by N25 to N1,325 per litre.
- International crude prices decline due to renewed US-Iran diplomatic engagement.
- Petrol prices at coastal depots move closer to Dangote's new benchmark.
