Fears of monopoly rise as Dangote controls N14.4tn petrol market

Energy experts, economists, and industry operators have raised fresh concerns over the growing dominance of Dangote Petroleum Refinery in Nigeria’s fuel market, after the Federal Government confirmed it has suspended all petrol import licences — leaving the Lekki-based facility as virtually the sole supplier of Premium Motor Spirit across the country.

Stakeholders sounded the alarm following confirmation by the Nigerian Midstream and Downstream Petroleum Regulatory Authority that it had not issued any import licence for petrol this year, saying local production now meets national requirements. Data from the NMDPRA showed that the Dangote refinery accounted for approximately 92 per cent of Nigeria’s daily petrol supply in February 2026, the only plant currently producing petrol in Nigeria, as other modular refineries focus on diesel production.

The scale of the market now under a single operator is staggering. Taking a conservative price of N1,000 per litre and total daily consumption of 39.5 million litres in February, Nigeria’s petrol market is worth over N14.4 trillion annually.

An industry operator, who sought anonymity over the sensitivity of the matter, warned that allowing one refinery to dominate the downstream sector without import competition is unhealthy. “The NMDPRA has not issued any licence for petrol imports this year. Dangote is gradually enjoying a monopoly in the downstream, and we all know that this is not healthy for any sector,” the operator said, adding that imported petrol had recently been priced lower than locally refined fuel.

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The supply shift has been rapid. In January 2026, petrol imports still averaged 24.8 million litres per day alongside domestic production of 40.1 million litres, pushing total daily supply to 64.9 million litres. By February, however, imports had fallen sharply, causing an overall daily supply decline of 25.4 million litres — a 39.1 per cent drop month-on-month.

The ripple effects on competing businesses have already been severe. TotalEnergies Marketing Nigeria recorded a loss of ₦14.1 billion in the first nine months of 2025, a reversal from profit the previous year, a downturn directly attributed to disruption caused by the Dangote Refinery. Conoil Plc saw after-tax profit collapse by 87.9 per cent over the same period, while Oando Plc announced it had paused trading of refined products entirely, reporting no petrol cargo sales for most of the year.

Energy analysts have urged caution even as they acknowledge the refinery’s achievements. One expert noted that heavy dependence on Dangote’s output reflects structural weaknesses in Nigeria’s refining landscape rather than deliberate market manipulation, pointing to the absence of functional NNPC refineries and the lack of viable alternatives. “Relying on the Dangote refinery to supply an average of 50 million litres daily, in tune with 90 per cent of our daily consumption, is a complete energy risk. Competition must be natural,” the expert warned.

The NMDPRA acknowledged the risk, noting it must be careful to ensure the country is not left stranded in the event of any operational failure at the refinery. The regulator nonetheless warned against resuming costly petrol importation, while the Minister of Finance, Wale Edun, declared the government would not intervene in market pricing, saying any intervention would only be considered as a last resort.

Calls for proactive regulation are growing louder. Analysts stressed that the Petroleum Industry Act grants the NMDPRA the authority to enforce competition in the downstream sector, and that the regulator must exercise those powers to prevent the market from being stranded by over-reliance on a single supplier.

The Dangote Refinery, which opened in May 2023 and is the world’s largest single-train refinery, has announced plans to more than double its production capacity to 1.4 million barrels per day — a scale that would make it the largest refinery on earth. For now, however, that ambition only deepens the concentration concerns keeping Nigeria’s energy sector on edge.