The Dangote Refinery has reversed its recent increase in the ex-gantry price of Premium Motor Spirit (PMS), cutting the rate by N75 to N1,200 per litre, industry sources confirmed on Wednesday.
The adjustment comes barely days after the refinery raised petrol prices to about N1,275 per litre, citing volatility in the international oil market that drove up crude input costs and overall production expenses.
Market analysts attribute the latest reduction to a sharp drop in global crude oil prices. Brent crude futures fell to $95.05 per barrel, marking a 13 per cent decline, while West Texas Intermediate (WTI) crude closed at $97.18 per barrel, down nearly 14 per cent.
Energy economist Dr. Kelvin Madu explained that the downturn reflects easing geopolitical tensions in the Middle East, particularly following reports of a conditional two-week ceasefire agreement between the United States and Iran.
“Oil prices are highly sensitive to geopolitical risks. The temporary de-escalation between Washington and Tehran has reduced fears of supply disruptions, leading to a price correction in the global market,” he said.
According to Madu, the refinery’s decision to adjust prices downward demonstrates the direct linkage between Nigeria’s domestic petrol pricing and international crude oil benchmarks.
Fuel marketers across major cities, including Lagos and Abuja, welcomed the development, expressing optimism that the price cut would trickle down to retail pump prices in the coming days.
National Vice President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Alhaji Abubakar Maigandi, noted that the reduction could ease operational pressures on marketers.
“A lower ex-gantry price provides some breathing space for marketers and should ultimately reflect at the pumps, provided there are no unexpected logistics or distribution bottlenecks,” he said.
Commuters and transport operators also reacted positively, hoping the adjustment would moderate transportation fares and alleviate the burden of rising living costs amid persistent inflation.
Energy policy analyst Mrs. Tolu Akinyemi observed that the development underscores Nigeria’s continued exposure to global oil price dynamics, despite recent strides in domestic refining capacity.
READ ALSO: Nigeria leads Africa in refining as Dangote exports 456,000 tonnes of fuel
“The expectation was that local refining would insulate Nigeria from some external shocks. While the Dangote Refinery has reduced reliance on imports, pricing still aligns closely with global benchmarks like Brent and WTI. This means international volatility will continue to influence domestic fuel prices,” she said.
Commissioned in 2023, the Dangote Refinery was widely anticipated to transform Nigeria’s downstream petroleum sector by reducing import dependence and stabilizing supply. However, analysts say the current pricing model reflects a market-driven approach tied to global crude costs.
Industry observers believe that if the downward trend in crude oil prices persists, further adjustments in petrol prices could follow, potentially offering temporary relief to consumers and businesses grappling with economic pressures.