Oil Price Drop Triggers Fresh Competition in Nigeria’s Downstream Market 

The recent drop in global crude oil prices has triggered a fresh wave of competition in Nigeria’s downstream petroleum market, as Dangote Petroleum Refinery and other major marketers have announced lower prices for Premium Motor Spirit (PMS), commonly known as petrol.

The sudden drop in global crude prices below $80 per barrel, primarily driven by the de-escalation of Middle East tensions and the signing of the US-Iran peace deal, is rapidly reshaping Nigeria’s deregulated downstream market.

According to OilPrice.com, Brent Crude, the international benchmark, dropped to $78.14 per barrel, while the U.S. West Texas Intermediate (WTI) fell to $75.20 per barrel on the morning of Thursday, June 18, 2026.

This latest decline followed the signing of an interim agreement by the U.S. and Iran to end the ongoing war, reopen the Strait of Hormuz and waive U.S. sanctions on ‌Tehran’s oil, resolving the largest energy supply disruption in history, according to a report by Reuters.

Before U.S. President Donald Trump announced the preliminary peace deal with Iran, Brent crude was hovering between $93 and $95 a barrel.

Because of the severe supply shock caused by the closure of the Strait of Hormuz since late February 2026, when the conflict started, oil prices had been trading at a significant premium, reaching a peak of almost $120 per barrel at some point. 

Though Nigeria is a major oil producer and also has the presence of Dangote Refinery, the largest single-train refinery in the world, the fuel price is still being influenced by the movement of crude prices in the international market. Since its commencement of operations in full-scale, the 650,000 barrels per day refinery has continued to adjust its prices for petroleum products in line with the international oil price benchmark. 

Following Trump’s initial announcement of the Memorandum of Understanding, global crude prices plunged roughly 5 per cent to a three-month low. 

Consequently, downstream operators in Nigeria’s petroleum sector responded with the adjustment of petroleum product prices.

Being a dominant player, Dangote Refinery fired the first shot in what now seems like an ensuing price war with the announcement of a ₦75 price cut for its petrol at the gantry from ₦1,250 to ₦1,175 per litre.

‎”Following the de-escalation of tensions in the Middle East, which has impacted energy prices, we wish to inform you that we have reviewed our Premium Motor Spirit (PMS) gantry/coastal price,” the refinery stated in a notice to customers on Monday, June 15.

‎The refinery also cut its coastal loading price from ₦1,595,790 per metric tonne to ₦1,495,215 per metric tonne, reflecting a reduction of ₦100,575 per metric tonne.

The Major Depots Retaliate

The latest price reduction by the $20 billion refinery, which took effect on Tuesday, June 16, sparked a fresh round of competition in the downstream petroleum market after three months of oil rally, which sent the pump price of petrol to about ₦1,400 per litre across the country.

Dangote Refinery’s move spurred independent importers and private depot operators, among others, to immediately execute what analysts described as aggressive defensive pricing. 

​By the morning of June 16, data from downstream tracking portals showed coordinated price drops. Major depot operators, including Aiteo, A.A. Rano, Rainoil, 11PLC (Mobile), and Ardova, immediately crashed their wholesale prices by nearly 5 per cent, dropping their rates to ₦1,180 per litre to remain competitive with Dangote’s ₦1,175 ex-depot price, according to a report by Petroleumprice.ng on June 16.

Further data obtained from the platform on Wednesday showed that several depots further reduced their ex-depot prices. While Dangote Refinery is selling PMS at ₦1,178 per litre, Aiteo reduced its price to ₦1,175 per litre, undercutting the refinery amid intense competition. Other depot operators such as Rain Oil, AA Rano, Integrated Ascon, and African Terminal were selling at ₦1,177 per litre. 

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The private depot owners are said to be reacting to the further drop in the price of crude oil. 

Other marketers still selling at the same rate as Dangote Refinery are Ardova and Aipec. Pinnacle Oil sells above Dangote (₦1,179), while Nepal is selling at ₦1,197. Matrix, Prudent, Northwest, AYM Ashafa, and Mainland are selling ₦1,200, while Sigmund is selling ₦1,205 per litre.

Old Retail Prices Remain

While the price drop and ensuing competition is expected to bring relief to consumers, it is yet to be reflected at the pump as filling stations have not adjusted prices in line with the falling ex-depot price.  

Across Lagos, Abuja, and Port Harcourt, pump prices still hover between ₦1,270 and ₦1,300 per litre, Pinnacle Daily’s checks revealed. 

Market analysts have observed that the pace of domestic fuel price reductions has not matched the speed at which crude prices rose earlier in the year. They argued that fuel prices should drop at the same rate at which they surged when crude prices moved up to ease pressure on the market and consumers.

Some said retailers are still selling at the current rate due to older, high-cost inventory. 

Market analysts project that pump prices will begin to drop nationwide within the week as cheaper supply flows through the logistics chain.

The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria, Chinedu Ukadike, expressed confidence that the petrol price would further drop.

In an interview, Ukadike projected that petrol pump prices could drop to between ₦1,200 and  ₦1,250 per litre in Lagos, while prices may be around ₦1,300 in other parts of the country.

On why marketers are yet to reduce pump prices, the IPMAN spokesman said they are still selling old stocks bought at a higher cost. He stated that while consumers expect an immediate reduction in price, doing so would result in significant losses for marketers.

According to him, marketers will start adjusting to the new price by Friday and urged consumers to exercise patience.

Debate over imported fuel being cheaper than locally refined products

The issue of imported fuel being cheaper than locally refined products has continued to generate reactions both among market stakeholders and consumers.

According to data released by the Major Energies Marketers Association of Nigeria (MEMAN), the landing cost of petrol as of June 10, 2026, was ₦1,100.92 per litre, while diesel (AGO) was ₦1,425.05 per litre. This means the imported fuel is cheaper than Dangote Refinery’s gantry price. 

Spokesperson of the Petroleum Products Retail Outlet Owners Association of Nigeria, Joseph Obele, called on downstream regulators such as the NMDPRA to look into the dynamics. Obele called for the issuance of more licences for fuel imports.

Some industry stakeholders have attributed the variation in the landing cost of imported fuel and locally refined ones to product specifications

Former Chairman, Major Energies Marketers Association of Nigeria, Mr Adetunji Oyebanji, said Dangote Refinery’s gantry is higher than imported ones because the refinery is supplying products with higher specifications that are acceptable for export to places like Europe and America.

According to him, such specifications may be of higher standards when compared to what is permitted in Nigeria. 

PETROAN has continued to advocate keeping import channels open as a way of creating diverse supply sources and strengthening competition. The group pointed out that previous price drops in products like diesel were directly accelerated when imported vessels arrived, forcing local refining prices down to remain competitive.

However, those backing local refiners say the local producers, such as Dangote Refinery, have proved the capacity to meet national demands, hence no need to allow more imports that would create pressure on foreign exchange.