Fuel Price Tensions: Dangote Refinery Faces Criticism Over Alleged Dual Pricing Practices
Nigeria’s petroleum landscape is confronting fresh unrest as major fuel importers and depot stakeholders raise concerns about Dangote Petroleum Refinery’s alleged double standards in pricing. According to claims by the Depot and Petroleum Product Marketers Association of Nigeria (DAPPMAN) and the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), Dangote is reportedly offering petrol at rates as much as ₦65 lower per litre to international traders compared to domestic buyers within Nigeria. This price gap has sparked fears of unfair competition and potential disruptions to the local downstream oil sector.
Olufemi Adewole, Executive Secretary for DAPPMAN, alleged that this pricing disparity has prompted many marketers to source cheaper petrol from Lomé, Togo—supplied by international traders who can outcompete Dangote’s prices for Nigerian buyers. Citing his conversation with The PUNCH, Adewole explained:
“Dangote is selling to international traders at ₦65 cheaper than what he is selling to us. In some instances, we were able to buy from those people and still bring it to Nigeria. They will take the product to Lomé, claiming they are buying large quantities.”
He further disclosed that domestic marketers have frequently been left without supply allocations or have received offers under terms that make the business unviable, effectively compelling traders to purchase from alternative sources outside Nigeria. This scenario, he warned, risks eroding the competitive ability of local fuel marketers.
Local Marketers Press for Fair Pricing
Beyond pricing complaints, DAPPMAN has called for a transparent pricing structure that recognizes the logistical and operational challenges domestic marketers face. Adewole suggested that Dangote must adjust its prices and extend discounts that reflect actual freight costs and other expenses incurred between the refinery’s jetty and local depots:
“Dangote has to give us a discount for freight cost and other expenses between his jetty and our depots. Without this, we can’t sell competitively. People will continue to import if it’s cheaper abroad.”
Backing up DAPPMAN’s assertions, Billy Gillis-Harry, President of PETROAN, confirmed that pricing inconsistencies exist, with Dangote’s products costlier for Nigerians than for regional buyers in Togo:
“Exactly, DAPPMAN said the correct thing. It is true. We don’t want to be saying everything. But the way things are going, one day we will say everything.”
Both associations believe that unless Dangote synchronizes its pricing model to benefit the domestic market, Nigeria risks losing valuable market share to regional actors—and placing local jobs, investment, and economic stability at risk.
Dangote Refinery Responds, Denies Allegations
Responding to these concerns, the Dangote Petroleum Refinery rejected DAPPMAN’s allegations and questioned the motives behind the outcry. In an interview with journalists, a company spokesperson suggested that recent industrial tensions involving the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG)—who accused Dangote of anti-union practices—stem from marketer associations such as DAPPMAN.
“We now know who is behind NUPENG. Our free delivery starts Monday,”
the spokesman announced, indicating that the refinery had commenced a logistics-free delivery scheme to address distribution challenges.
Dangote’s representatives also disputed the logic behind purchasing fuel from Togo, asking, “When did they stop buying from Russia and Malta?”—hinting at the evolving landscape of fuel importation across West Africa. Nevertheless, the tension extends beyond logistics, with Adewole claiming Dangote has a record of implementing last-minute price cuts designed to destabilize the local market:
“He [Alhaji Aliko Dangote] once said he would crash the price each time importers brought in cargoes, and this puts competitors under financial stress,” Adewole recounted, alleging that such actions consistently dampen the ability of local marketers to remain profitable.
He described Dangote’s repeated price reductions as “calculated moves to stifle competition,” suggesting Nigerian buyers routinely get a worse deal than international customers.
DAPPMAN maintained that Nigeria’s petroleum demand cannot—and should not—be met by a single refinery. According to their statements, the Dangote refinery currently only supplies 30% to 35% of Nigeria’s total petrol requirements. The remaining demand, they noted, is covered by “responsible petroleum product marketers who import and distribute under strict regulation.”
Furthermore, marketers raised concerns about hidden costs associated with the refinery’s new “free delivery” policy. Adewole explained that under this programme, marketers are required to transport 25% of allocations using only Dangote-operated trucks, and these trucks are reportedly hired at commercial (not preferential) rates—adding unanticipated expenses to local operations.
Reforms on the Horizon: Dangote’s CNG Truck Initiative
Seeking to address logistics and price concerns, Dangote Refinery announced plans to deploy a fleet of compressed natural gas (CNG) powered trucks, commencing Monday, to enhance its logistics-free distribution efforts. According to company officials, this initiative is designed to reduce the cost of transport, with the ex-depot price expected to drop to ₦820 per litre. The hope is that these measures will translate into lower pump prices not only in Lagos but also across other major Nigerian states.
While these reforms are set to roll out imminently, the sector remains jittery. The ongoing dispute is occurring against the backdrop of significant labour unrest. NUPENG recently announced plans to strike, alleging that Dangote blocks drivers from joining trade unions. Though DAPPMAN clarified their association is not directly part of the NUPENG dispute, they said they are “alarmed by the tone and escalation of the crisis,” warning that further unrest could undermine fuel supply stability nationwide.
Broader Impact: Local Competition, Regional Trade, and the Future of Nigeria’s Oil Sector
Nigeria, Africa’s largest oil producer, has long struggled to balance local refining capacity with heavy fuel imports. The promise of Dangote’s flagship refinery—currently Africa’s largest single-train facility—was to address recurring fuel shortages and high prices. However, as recent events show, the transformation of Nigeria’s downstream oil sector is proving more complex than anticipated.
Industry watchers note that balancing market interests remains challenging. Lagos-based oil analyst Chuka Obinna commented,
“Ensuring fair access to locally refined products is key. Both government and private refineries have a responsibility to create a level playing field—otherwise, we risk driving small businesses out while strengthening regional competitors.”
There are also regional implications. West African nations like Ghana, Benin, and others have become critical transit points in the fuel supply chain due to pricing differentials, regulatory barriers, and changing logistics costs. The knock-on effects of Nigeria’s pricing policies can influence supplies, black market activity, and cross-border trade throughout the region.
Policymakers, regulators, and industry players are now tasked with ensuring robust oversight, transparent competition policies, and sustainable strategies that empower both domestic enterprises and regional partnerships. The conversation is far from over, and as Nigeria’s energy needs continue to grow, stakeholders across the continent and beyond will be watching how these disputes are resolved.
What’s your perspective on the ongoing price dynamics in Nigeria’s oil sector? Do you think local marketers and the Dangote Refinery can find a sustainable balance? Drop your comments below and follow us for the latest business and energy sector updates.
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