By David Torough, Abuja

As the price war in the downstream oil sector continues leading to recurring reductions in the price of petrol, oil marketers have resorted to slashing the volume of their fuel purchase amid mounting losses from the price drop.

It would be recalled that the price war, primarily between Dangote Petroleum Refinery and the Nigerian National Petroleum Corporation Limited, began in November 2024 when Africa’s largest private refinery lowered the price of petrol from N990 to N970 per litre.

Dangote further reduced it to N899 per litre, citing the need to provide relief for Nigerians during the holiday season.

Days after Dangote’s move, NNPCL also slashed its ex-depot price of the product from N1,040 to N899 per litre, according to the Petroleum Products Retail Outlets Owners Association of Nigeria.

On February 1, 2025, Dangote Refinery again reduced the petrol price to N890 per litre before further lowering it to N825 per litre on February 27, setting the stage for continued pricing competition with NNPCL.

In a statement by its Group Chief Branding and Communications Officer, Anthony Chiejina, the refinery said the price adjustment was a direct response to the positive outlook within the global energy and gas markets and the recent reduction in international crude oil prices.

However, on March 3, 2025, some NNPCL retail outlets reported that the oil firm had also adjusted its petrol pump price to N860 per litre, reflecting the intense price war among fuel merchants.

According to stakeholders in the downstream sector, the frequent price reductions, signaling the ongoing price war between Dangote Refinery and NNPCL, have been beneficial to Nigerians.

However, energy experts argue that the continuous decline in PMS prices has been causing significant losses for oil marketers and importers, who lose an average of N2.5bn daily and N75bn monthly.

Amid mounting losses, oil marketers under PETROAN have called for a regulation mandating that fuel prices be adjusted only every six months, but it remains uncertain whether the regulatory body will approve the demand.

The National Vice President of IPMAN, Hammed Fashola, said that while the price war has benefited Nigerians, the unpredictability of fuel price reductions is forcing oil marketers to cut their purchases, leading to significant daily losses.

“The ongoing price reduction is affecting oil marketers negatively because we are losing money. For instance, if I buy products at N900 per litre today and the price drops by evening, you can see the problem, especially if the product is meant to last a month. That is the challenge marketers are facing now.

“Not buying large volumes of PMS is the only way to play it safe because when you buy in bulk, the price may drop again, which is exactly what is happening now. For all marketers, that is the reality we are dealing with.

“We just need to be careful when making purchases. We must equip ourselves with adequate information by understanding global market trends before buying. And we will only purchase products we are confident can be sold within a week.

“Of course. Any reasonable person would do that to minimise losses. Our people have already started. It is just a precautionary measure. How long this will last depends on the situation. If the price stabilises, everyone will relax and return to normal business. But if it remains unstable, there will always be the fear that prices could drop at any time. So, everyone would rather be cautious. It is about avoiding excessive losses. However, this practice might not last long, as it is only a short-term measure,” he said.

In yet another price change, the landing cost of PMS on Tuesday dropped to N774.82 per litre, making it cheaper than Dangote Refinery’s ex-depot price of N825 per litre.

The Major Energies Marketers Association of Nigeria revealed this in its latest Competency Centre daily energy data released during the week, noting that the estimated import parity into tanks had reduced by N152.56 or 16.5 percent from the N927.48 per litre recorded on February 21, 2025.

This drop follows a decline in Brent crude prices, which fell to $70 per barrel, while U.S. WTI crude dropped to $66.70 as of Wednesday, March 12, 2025, compared to around $76 and $69 per barrel, respectively, in February.

Marketers suggested that the continued drop in global oil prices could push the pump price of PMS to around N800 per litre. They added that the latest reduction in fuel import landing costs would further intensify the price war between Dangote Refinery, NNPC and fuel importers.

However, speaking recently, Fashola noted that prices could fall even further to as low as N500 per litre if crude oil drops to around $40 per barrel and the naira strengthens to below N1,000 per dollar.

He said, “On Tuesday, the landing cost of imported fuel was N774.82 per litre, cheaper than what Dangote was selling. But Dangote responded by lowering its price to N815 per litre. So, I believe this price war is beneficial for Nigeria. That is the beauty of deregulation. It fosters competition. As more players enter the market, we expect further price reductions.”

In its latest foreign trade report, the Nigerian Bureau of Statistics disclosed that the country’s petrol imports surged by 105 percent in 2024, reaching a staggering N15.42tn.

According to energy experts, the rise in fuel imports has raised concerns about the viability of local refineries and the impact of the ongoing price war between NNPC and Dangote Refinery.

IPMAN Denies Opposing Fuel Price Slash by Dangote, NNPCL

The Independent Petroleum Marketers Association of Nigeria (IPMAN) has refuted claims that it opposed the recent reduction in Premium Motor Spirit (petrol) prices by Dangote Refinery and the Nigerian National Petroleum Corporation Limited.

A former presidential aide Reno Omokri, in a post on his verified X (formerly Twitter) handle on Saturday night, alleged that IPMAN was protesting against the Federal Government due to the affordability of Dangote and NNPCL fuel.

Omokri claimed that rather than Nigerians protesting against high fuel prices, oil marketers were instead resisting the price cut.

He wrote, “For the first time in Nigeria’s history, IPMAN, the Independent Petroleum Marketers of Nigeria, are protesting against the Nigerian government because NNPCL and Dangote Refinery’s fuel is so cheap that their imported fuel is causing them to lose money.

“Instead of Nigerians protesting high prices, marketers are now railing against low costs. From N1050 to N815. Tinubu did it! In just one month, fuel prices have gone down three times.”

However, IPMAN has dismissed Omokri’s claims, insisting that it never opposed the recent fuel price reduction, which resulted from the full deregulation of the downstream sector.

IPMAN’s National Vice President, Hammed Fashola, in a statement made available to PUNCH online on Sunday, maintained that the report referenced by Omokri could not have originated from the association, as independent marketers have long championed the call for full deregulation of the oil and gas sector.

He explained, “Let me first educate the public about these two organizations, IPMAN and PETROAN. IPMAN is an association of independent petroleum marketers in Nigeria. We have been in existence for years and have maintained a long-standing relationship with the government, NNPCL, and Dangote.

“The said publication is not from IPMAN, and it cannot be from IPMAN because we have always advocated for total deregulation of the downstream sector. We understand the concept of deregulation, along with its benefits and consequences.

“We (IPMAN) are never against the reduction of petroleum product prices in the country, as it brings relief to citizens. Moreover, as marketers, lower prices mean reduced working capital for us as well.”

Fashola further explained that fuel prices in the country are primarily influenced by two factors—the exchange rate and crude oil prices—neither of which are controlled by refiners or importers, especially in a fully deregulated market.

He added, “A fixed timeframe or prior notice for price changes, as previously suggested, is impractical in this era of total deregulation due to competition among market players—everyone wants a share of the market.

“IPMAN, as a body, fully supports the government, NNPCL, and Dangote in this phase of total deregulation and subsidy removal. We stand by the federal government’s reform agenda under President Asiwaju Bola Ahmed Tinubu,” Fashola said.