Dangote Refinery has significantly impacted the diesel market in Nigeria by reducing the price of diesel from about N1,800 per litre to N1,200 per litre since it began distributing its product. Independent marketers have lifted over 25 million litres of diesel from the refinery in less than three months since production started. The consistent supply and lower prices have been attributed to the refinery’s operations, leading to stability in the market.
The refinery, located in Lagos, has opened applications to marketers for distributing diesel and is preparing to start producing Premium Motor Spirit (PMS) in July. Various associations like the Petroleum Products Retail Outlet Owners Association of Nigeria, Major Oil Marketers Association of Nigeria, and Independent Petroleum Marketers Association of Nigeria have confirmed that their members are registering with Dangote Refinery for product distribution.
Aliko Dangote, the Chairman of Dangote Group, has faced challenges from what he referred to as an “oil mafia” that attempted to hinder his efforts in building Africa’s largest refinery. However, modular refinery owners have supported Dangote’s claims regarding this oil mafia that aims to prevent Nigeria from refining crude oil domestically. Dangote highlighted the role of financial institutions like Afreximbank and Access Bank in supporting his refinery project despite opposition from the oil mafia.
In addition to impacting the diesel market, Dangote Refinery is set to begin petrol production soon, with petroleum marketers already registering with the company for product loading. The Crude Oil Refinery Owners Association of Nigeria (CORAN) has stated that local and international oil merchants have impeded domestic petroleum production in Nigeria and are responsible for high petrol prices. CORAN believes that increased local refining will lead to a significant drop in petrol prices once mass production begins.
