Why NNPC crashed Dangote petrol prices for marketers

• The Nigerian National Petroleum Company Limited (NNPC) has crashed the price of Dangote petrol for marketers
• Investigations show that marketers began lifting the Dangote petrol from the NNPC Trading at N765 per litre
• The company had said that marketers cannot purchase the product directly from the refinery due to costs

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

Many oil marketers have begun purchasing products from the national oil firm, confirming NNPC's position that independent marketers cannot yet afford Dangote petrol due to its high cost.

Findings show that 11Plc, TotalEnergies, AA Rano, and other independent marketers have begun lifting Dangote petrol via the Nigerian National Petroleum Company (NNPC) Trading Limited to retail outlets nationwide at N765.99 per litre.

NNPC crashes Dangote petrol prices as marketers lift at new cost Credit: Bloomberg/Contributor
Source: UGC

Marketers pay N769/litre to lift Dangote petrol

According to reports, some petroleum marketers who completed payments on the NNPC trading portal began lifting petrol earlier this week, according to the existing agreement between marketers and the refinery.

BusinessDay reports that the managing director of 11Plc, Tunji Oyebanji, confirmed on Thursday, September 19, 2024, that some marketers have started lifting via the NNPC, the sole off-taker of the product.

Oyebanji disclosed that they are the first marketers to complete payment on the NNPC portal as they have no direct arrangement with the Dangote Refinery.

The report said that NNPC Retail, 11Plc, TotalEnergies, and AA Rano are among the first marketers that have picked the refinery’s product.

NNPC remains the sole distributor of Dangote petrol

Adedapo Segun, executive vice president downstream at NNPC, said that marketers cannot purchase directly from the refinery as the product is still being subsidised.

Segun said the market value of PMS is higher than the N766, 765 or N799 that the NNPC is selling.

NNPC, Dangote Refinery trade words

Recall that on September 15, 2024, the NNPC disclosed that it purchased petrol at the Dangote Refinery for N898 per litre, stating that market forces now determine domestic pump prices.

Reacting to the NNPC, the Dangote Group said that the NNPC assertion is misleading and mischievous and aimed at undermining the refinery’s achievement in addressing Nigeria’s energy needs.

Countering the refinery, NNPC insisted that it bought the product at N898 per litre from the facility and requested a discount from the plant, promising to pass the cost 100% to the consumer.

NNPC releases Dangote petrol price list

NNPC disclosed that in addition to landing costs from refineries, suppliers must pay mandatory and regulatory charges for each litre of petrol.

The charges include the Nigerian Midstream and Downstream Petroleum Regulatory Authority fee of N8.99, inspection fee of N0.97, distribution cost in Lagos at N15, and profit margin cost of N26.48.

NNPC said that once freighting and other statutory costs are added, the product would cost more at the pumps: N950.22 per litre in Lagos, N980.22 in Rivers, and N992.22 in Abuja. The selling price in Maiduguri was N1,019.

Three marketers abandon Dangote fuel

Legit.ng earlier reported that three major oil marketers expect vessels of imported petrol this week.

The dealers disclosed that vessels are bringing about 141 million litres of petrol into Nigeria following the Nigerian government's total deregulation of the downstream oil sector.

The marketers also disclosed the recent rise in prices of Dangote petrol issued by the Nigerian National Petroleum Company Limited (NNPC) on Monday, September 16, 20024, allowed for petrol imports.

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Source: Legit.ng