With the announcement of a pump price reduction of Petrol by MRS filling station, in collaboration with Dangote Refinery, the competition in Nigeria’s downstream oil sector will reach new heights as the Nigerian National Petroleum Company Limited (NNPCL) may consider reducing petrol prices to keep up with Dangote Refinery’s recent price slash.
Industry experts believe that the price competition between Dangote Refinery and NNPCL, looks beneficial to fuel prices as the consumers would go to cheaper sources.
The National President of the Petroleum Products Retail Outlet Owners Association, Billy Gillis-Harry, and the spokesperson for the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, who spoke to Daily Post expressed confidence that NNPCL will be compelled to lower its prices soon to maintain its market relevance.
Background
On Monday, MRS filling stations announced new petrol prices via their official X account, revealing a significant drop to ₦925 per litre in Lagos, ₦933 in the South West, ₦945 in the North, and ₦955 in the South East.
This marks a decrease from the previous average price of ₦970 per litre.
This price cut follows Dangote Refinery’s decision on February 1, 2025, to lower its ex-depot price from ₦970 to ₦870 per litre.
While industry experts believe NNPCL has no choice but to respond with a similar price reduction, transport fares and food prices remain unchanged.
According to Gillis-Harry, Nigeria’s weak purchasing power is a key factor preventing these price cuts from significantly impacting daily expenses.
He suggested that boosting local production in sectors such as agriculture, fishing, and technology is necessary for economic relief
Ukadike, however, remains optimistic that the effects of lower petrol prices will be felt gradually.
However, the frequent fluctuations in petrol prices is an area of concern as it could disrupt fuel supply security, Harry said.
He highlighted that sudden price cuts negatively affect marketers who had purchased stock at higher rates, and that until old stock bought at the previous prices are sold, the new reduction cannot be effected.
The competition in prices between NNPCL and Dangote Refinery have been a key driver of petrol price reductions since late 2024.
After Dangote Refinery announced a reduction in its ex-depot price in December, from ₦899.50 to ₦970, it prompted NNPCL to follow suit with its own price cut.
The current reduction in price leaves one to question, Is NNPCL willing to adjust its pricing to maintain its dominance in the sector?
