Petrol Price May Crash To ₦300/Litre

The pump price of Premium Motor Spirit, commonly known as petrol, is expected to decrease to around ₦300 per litre once the Dangote Petroleum Refinery and other local producers begin large-scale production.

Naija News reports that the operators of modular refineries stated on Sunday that achieving this price drop would depend on the government providing sufficient crude oil to local refiners, emphasizing that foreign refineries are taking advantage of Nigeria.

Speaking under the aegis of the Crude Oil Refinery Owners Association of Nigeria (CORAN), they explained that the reduction in diesel costs following Dangote’s production would similarly occur for petrol prices once it is produced extensively in Nigeria.

CORAN, a registered association of modular and conventional refinery companies in Nigeria, stated through their Publicity Secretary, Eche Idoko, that with adequate crude oil supply, producing PMS in large volumes could reduce the pump price to ₦300/litre, benefiting Nigerians instead of importers.

Idoko disclosed to a Punch correspondent that: “A lot of companies today benefit from the importation of petroleum products at the expense of Nigerians.

“If we begin to produce PMS today in large volumes, provided there is adequate crude oil supply, I can assure that we should be able to buy PMS at ₦300/litre as the pump price.

“Why make Nigerians buy it at almost ₦700/litre when you know that if you allow refineries work the price will come down? Is it because you want to satisfy the global refiners abroad that are making so much from us?”

Addressing concerns that the dollar pricing of crude oil prevents a substantial price drop, the CORAN official affirmed that petrol prices would decline once it is mass-produced by local refiners.

He said, “We were selling diesel for ₦1,700 to ₦1,800/litre, but as soon as Dangote refinery started production he brought down the price to ₦1,200/litre. What other proofs do you need?

“As I speak to you now there is every tendency that before December diesel price will drop further. The only reason reason why diesel is not doing below ₦1,000/litre is because of our exchange rate.

“If the exchange rate drops, diesel will drop below the ₦1,000/litre price. Now the exchange rate concern is because Dangote imports crude. If he is not importing, the exchange rate may not have so much effect, though he is still buying crude in dollars (in Nigeria) anyway.”

Africa’s richest man, Aliko Dangote, stated that with the implementation of the Dangote refinery’s plans, Nigeria would no longer need to import petrol starting in June this year.

Dangote also mentioned that his refinery could meet West Africa’s petrol and diesel needs, as well as the continent’s aviation fuel demand.

Speaking at the Africa CEO Forum Annual Summit in Kigali, he expressed optimism about transforming Africa’s energy landscape.

“Right now, Nigeria has no cause to import anything apart from gasoline (petrol) and by sometime in June, within the next four or five weeks, Nigeria shouldn’t import anything like gasoline; not one drop of a litre,” the billionaire had declared.

Dangote previously reduced diesel pump prices from ₦1,700-₦1,800/litre to ₦1,200/litre, later lowering it to below ₦1,000/litre but faced challenges sustaining it due to currency fluctuations, eventually returning to the initial rate of ₦1,200/litre.

The CORAN spokesperson emphasized on Sunday that this is why modular refiners have been advocating for the sale of crude oil at the naira equivalent of the dollar rate.

“We have told them (government) that even the dollars that you are asking us to use and buy this product, it is detrimental to the country. Strengthen the naira. We will buy at the international market rate, but at a naira equivalent.

“These are the issues and they know these things but we can’t explain why they really can’t take decisions to change these concerns.

“Get crude to local refineries, allow crude purchase in naira equivalent, make the environment business-friendly and watch locally produced petroleum product prices crash,” Idoko stated.

Nigeria has 25 licensed modular refineries, with five of them currently in operation, manufacturing diesel, kerosene, black oil, and naphtha, while approximately 10 are in varying stages of completion, and the rest have been granted licenses for establishment.