Dangote Petroleum Refinery has announced another reduction in the ex-depot price of Premium Motor Spirit (PMS), also known as petrol, cutting it by N50 per litre to N1,075, marking the fourth price cut by the refinery within a single month.
The company confirmed the price cut in a statement released on Thursday, July 2.
The latest reduction brings the cumulative price drop for petrol to over N200 per litre since May 30, 2026.
The refinery has also reduced the ex-depot price of Automotive Gas Oil (AGO), commonly known as diesel, by N300 per litre, and Jet A1 aviation fuel by N520 per litre over the same period.
Refinery Explains Pricing Strategy Amid High Crude Costs
The company clarified that refinery pricing does not move in line with daily international crude oil quotations. It said crude oil is procured weeks, and in some cases months, before processing under commercial contracts linked primarily to monthly average pricing mechanisms rather than prevailing spot market prices.
The refinery disclosed that it processed crude oil procured at substantially higher costs than current market prices. It specifically stated that the average landed cost of crude processed was approximately $124.80 per barrel in May and $95.25 per barrel in June, compared with the current international benchmark of about $71.01 per barrel.
The company further noted that its feedstock costs differ materially from benchmark quotations, as crude is acquired on a Dated Brent basis plus market premiums, freight, and logistics costs.
Absorbing Costs to Protect Consumers
Despite elevated feedstock costs, Dangote Petroleum Refinery stated it deliberately absorbed a substantial portion of the increase rather than transferring the full burden to consumers. This decision, it said, was aimed at supporting market stability, reducing inflationary pressures, and shielding Nigerians from extreme volatility in global energy markets.
The company noted that this strategy has helped keep petroleum product prices in Nigeria lower than those in neighbouring countries, even after adjusting for taxes.
The refinery currently supplies volumes sufficient to meet national demand, helping to strengthen energy security, eliminate dependence on imports, conserve foreign exchange, and provide greater price stability for consumers and businesses.
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It assured that it will continue to cut fuel prices as the cost of landing crude cargoes drops.
“As lower-cost crude cargoes progressively enter our production cycle, we have commenced a phased reduction in product prices,” the refinery stated.
“Today’s N50 per litre reduction is the fourth price cut in one month, bringing cumulative reductions to above N200 per litre on PMS. This approach ensures that pricing decisions are anchored on actual production economics and inventory costs rather than short-term fluctuations in international oil markets.”
The company expressed confidence that Nigerians can expect further price moderation as procurement costs continue to decline and lower-priced inventories replace higher-cost crude stocks, provided international market conditions remain favourable.
Dangote Petroleum Refinery reaffirmed its commitment to supplying high-quality, internationally compliant petroleum products at competitive prices while supporting Nigeria’s economic growth and the long-term sustainability of domestic refining.
Victor Ezeja is a Nigerian journalist skilled in producing insightful news analyses, feature stories, and interviews that simplify complex issues and drive informed public discourse. His work combines rigorous research, balanced reporting, and compelling storytelling to highlight developments shaping industries and society. Victor, who holds a Master's Degree in Mass Communication, specializes in energy, aviation, business, and economic reporting. He can be reached via @VICTOREZEJA on X