Marketers Unveil Cheaper Petrol Price as Landing Cost Crashes By N227 Below Dangote’s Rate

Nigeria’s downstream petroleum market is witnessing a fresh pricing shift as the estimated landing cost of imported petrol has dropped to about ₦1,072 per litre, creating a price gap of more than ₦227 below the gantry price of Dangote Petroleum Refinery.

The latest figures, released by the Major Energies Marketers Association of Nigeria (MEMAN), indicate that imported Premium Motor Spirit (PMS) is now significantly cheaper on an import-parity basis than petrol supplied by the Lekki-based refinery.

According to the November 5 energy bulletin, the estimated spot import-parity price of petrol stood at ₦1,072.72 per litre at ASPM Jetty and ₦1,071.72 per litre at NPSC-NOJ Jetty, both in Apapa, Lagos.

The figures represent a significant decline from the 30-day average landing cost of ₦1,252.02 per litre, indicating a reduction of about ₦179 to ₦180 within the period.

The development could intensify competition between fuel importers and domestic refiners, particularly as marketers explore cheaper supply options amid changing international oil market conditions.

Dangote’s petrol price faces fresh competition

The latest import-cost figures have placed fresh pressure on Dangote Refinery’s petrol pricing.

As of November 5, the refinery’s gantry price stood at ₦1,300 per litre, while its coastal price was ₦1,250 per litre.

A comparison with the estimated landing cost of ₦1,072.72 shows that imported petrol was about ₦227.28 cheaper per litre than Dangote’s gantry price.

At the NPSC-NOJ Jetty, the difference widened to approximately ₦228.28 per litre.

The price gap could influence the purchasing decisions of petroleum marketers, especially those seeking to reduce their supply costs and remain competitive in the downstream market.

However, the figures do not mean imported petrol is already being sold to consumers at ₦1,072 per litre. Import-parity prices are estimates of the cost of bringing petroleum products into the country and do not necessarily represent the actual prices paid for cargoes or the final prices charged at filling stations.

Additional expenses, including storage, transportation, distribution and marketers’ margins, must also be considered.

Global oil prices trigger sharp reduction

The decline in petrol landing costs followed a major fall in international crude oil prices on November 4.

Brent crude futures reportedly dropped by about 8.1 per cent to $95.21 per barrel, while West Texas Intermediate (WTI) fell by approximately eight per cent to $88.40 per barrel.

The sharp movement in the international oil market was linked to changing expectations surrounding geopolitical tensions involving the United States and Iran.

Lower global oil prices generally reduce the cost of petroleum imports, although the final impact on Nigeria’s landing costs also depends on refined-product prices, exchange rates, shipping expenses and other import-related charges.

MEMAN’s calculations reportedly used a seven-day average exchange rate of ₦1,347.44 to the dollar, alongside financing and shipping assumptions.

The figures therefore provide an indication of the changing economics of petrol imports rather than a guaranteed transaction price for every marketer.

Will Nigerians buy petrol cheaper?

For motorists and other petrol consumers, the major question is whether the latest reduction in landing costs will translate into lower prices at filling stations.

Although the development could encourage competition and create room for price adjustments, an immediate reduction in pump prices is not guaranteed.

The final price of petrol depends on the actual cost of imported cargoes, depot prices, transportation expenses, distribution costs and the commercial decisions of individual marketers.

Consequently, the difference between the estimated landing cost and Dangote’s gantry price should not be interpreted as an equivalent amount that motorists will automatically save.

The latest figures could strengthen the bargaining position of importers and increase pressure on suppliers to review their prices as competition intensifies.

The development also highlights the changing dynamics of Nigeria’s deregulated petroleum market, where imported products and locally refined petrol compete for market share.

For now, motorists will be watching closely to see whether the latest decline in import costs leads to fresh reductions in depot and retail prices across the country.

Source: Legit.ng / Major Energies Marketers Association of Nigeria (MEMAN)