Fuel prices in Nigeria are expected to drop following a landmark agreement between the Independent Petroleum Marketers Association of Nigeria (IPMAN) and Dangote Petroleum Refinery. This collaboration will allow IPMAN to source fuel directly from the refinery, bypassing intermediaries and potentially lowering costs for Nigerian consumers.
At a press briefing in Abuja, IPMAN National President Abubakar Garima announced that Dangote Refinery has granted IPMAN access to lift Premium Motor Spirit (PMS), Automotive Gas Oil (AGO), and Dual Purpose Kerosene (DPK). Garima expressed optimism that the agreement would ensure a stable and accessible fuel supply nationwide, with a focus on affordability. He stated, “This new arrangement with Dangote Refinery will provide a steady and ceaseless supply of PMS products across Nigeria, at a rate more affordable for Nigerians.”
Energy expert Kelvin Emmanuel highlighted the agreement’s potential to reduce costs traditionally borne by IPMAN, including the financing and margin fees associated with imports managed by the Nigerian National Petroleum Corporation Limited (NNPCL). Emmanuel noted, “NNPC’s financing costs of $28 per metric tonne and margin costs of $26.48 per metric tonne, typically passed on to IPMAN, will now be eliminated.”
Clement Isong, Executive Secretary of the Major Energy Marketers Association of Nigeria, explained that final fuel costs depend on several variables, such as the exchange rate and logistics efficiency. While the landing cost for petrol recently dropped by 20.34% to N971.57 per litre, Isong clarified that prices vary based on the volume purchased and location. He stated, “In Lagos, for example, the landing price could be below N971 for bulk purchases, but for smaller quantities or deliveries outside Lagos, the cost may approach N1,000 per litre.”
Isong also explained that market prices reflect a 30-day average cost rather than daily fluctuations, influenced by exchange rates and economies of scale. “The market price is flexible,” he said, “and depends on factors like volume, logistics, and the exchange rate. For many marketers, landing costs are now lower, though prices remain a range based on how efficiently each marketer operates.”
The new IPMAN-Dangote partnership is expected to make fuel more affordable and widely accessible, providing relief to Nigerian consumers and strengthening market stability.
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