Lagos, Nigeria — April 10, 2025
The Dangote Petroleum Refinery has adjusted its pump price for premium motor spirit (PMS), popularly known as petrol, from N815 to N865 per litre — marking a N50 increase, despite a significant drop in global crude oil prices.
This development comes on the heels of the recent suspension of the Naira-for-crude oil deal between the Dangote Refinery and the Federal Government. The arrangement, which previously eased the financial strain of sourcing crude by allowing payment in local currency, was seen as a strategic measure to stabilize domestic fuel pricing. With its suspension, the refinery now has to import crude oil using foreign exchange, primarily U.S. dollars, compounding production costs.
The 650,000-barrels-per-day refinery, which is the largest in Africa and among the largest single-train refineries globally, had earlier in 2025 cut petrol prices three times, bringing it down to N815 per litre — a move that had raised hopes among Nigerians for more affordable fuel prices.
However, according to industry insiders, the increase to N865 is largely attributed to rising operational costs linked to dollar-based crude imports, even as global crude oil prices slid to $59 per barrel as of yesterday.
Oil marketers, including MRS Oil Nigeria Plc, have commenced lifting petroleum products from the refinery, signaling full-scale distribution despite the new price benchmark.
Analysts had anticipated a corresponding drop in petrol prices with the decline in crude prices, but the high cost of refining — coupled with forex scarcity and Nigeria’s continued reliance on dollar-denominated transactions — has eroded those expectations.
“The public naturally expects relief at the pump when crude prices fall, but local realities, especially the absence of a stable crude supply agreement and the forex challenge, have kept refining costs elevated,” said an energy expert who spoke under anonymity.
The price increase is expected to fuel renewed discussions on energy pricing, subsidy removal, and the broader implications for Nigeria’s inflation rate and cost of living.
The Federal Government has yet to issue an official response to the price hike. Stakeholders and consumer protection groups are closely monitoring the situation as the country continues to navigate the complexities of local refining in a challenging economic landscape.
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