Independent Marketers Believe Dangote Refinery will crash Pump Price of Fuel

The Punch newspaper has reported that Independent Petroleum Marketers Association of Nigeria has expressed the hope that the Dangote Petroleum Refinery will sell its Premium Motor Spirit, otherwise known as petrol, at N600 or N650/litre when the product is finally released into the market.

Expressing the optimism in an interview with the Punch newspaper, IPMAN National Vice President, Mr. Hammed Fashola, said the association believes that the Dangote Refinery would crash the price of petrol as it did with diesel, once it resumes full mprouction.

Fashola opined that that the $20bn refinery would bring down the cost of fuel if it gets the needed support, especially in terms of crude supply.

According to him, the Nigerian National Petroleum Company Limited, which is the sole importer of PMS, has been selling to marketers at N570/litre, but most IPMAN members buy from private depot owners at N700 and above

“We are marketers, we go for the best. We have been buying from the NNPC, but if the opportunity of Dangote comes and the price is favourable, we will grab it. It depends on the price.

“The official price from the NNPC is around N570/litre, but the third parties, the private depots sell PMS to most of our members at N700 and above.

“Plus or minus, we hope Dangote can sell between N600 and N650/litre. N600 is still okay. However, it depends on the cost of the production from Dangote’s end. We have to be factual and sincere to ourselves. The NNPC we are talking about has an element of subsidy or what they now call under-recovery. I think something is hidden there,” Fashola stated.

On the price of diesel, Fashola recalled, “We know Dangote refinery crashed the price of diesel. When the refinery started producing, diesel was around N1,600 and it went down to N1,000.

“Now you can buy diesel at N1,150 or N1,200/litre. We expect the same with PMS, but this crude crisis is a major challenge. Even if Dangote is buying crude in naira, if it is at the international market price, it will make no difference. We have to be realistic.”

The IPMAN leader said the association has had business discussions with some officials of the refinery on a possible partnership, saying the marketers are waiting for Dangote.

“The discussion continues. We are on course. I think very soon we will conclude the discussion. We are waiting,” he stated.

The PUNCH recalls that the President of the Dangote Group, Alhaji Aliko Dangote, had last month projected that the refinery would begin the production of petrol between August 10 and 12, 2024.

However, the 650,000 barrels per day capacity refinery could not roll out petrol on Monday for different reasons.

Findings showed that the ongoing crude supply crisis might be a setback to the refinery.

• Report abridged from initial report by Punch