Price war: Fuel marketers suffer heavy  loss of N250bn

...as Dangote crashes petrol price

The frequent price adjustments by management of the mammoth Dangote Refinery in the Ibeju-Lekki area of Lagos on refined petroleum products from the plant has had a significant impact on the nation’s downstream petroleum sector, Business Hallmark findings have revealed.

According to findings, while many tank farms and depots that once dominated Nigeria’s downstream petroleum sector have been forced to shut down after incurring heavy losses, the future of the few that have managed to stay afloat is now in jeopardy after Dangote Refinery effected another major price slash at the weekend.

The latest review by the largest single-train petroleum refinery in the world of its gantry price from N828 to N699 per litre, represents about 16 per cent decrease or N129 per litre of the product.

BH reliably gathered that the refinery also slashed the Marine price for petrol loaded through ships and badges from N798 to N669.

Apart from the price cut, the refinery also unveiled a 10-day credit facility for marketers to ease cash-flow pressures and boost product distribution.

The 10-day credit facility is open to all customers, subject to a minimum purchase of 500,000 litres and backed by bank guarantees.

These downward price reviews by Dangote, checks revealed, have made imported refined petroleum products from Europe and America by marketers to be uncompetitive in the fuel market.

Most buyers, including petroleum marketers and motorists, it was learnt at the weekend, have been abandoning more expensive products sold by importers for the cheaper Dangote fuel.

Surge in Buyers

Since the refinery effected the latest downward price review on December 11th, 2025, tanker traffic on the Lekki-Epe Expressway has increased considerably. On Friday and Saturday, many branded fuel tankers from within and outside the state were observed on the road leading to the refinery,  ostensibly to load products.

A source in the refinery, who did not want his identity disclosed, confirmed the surge in fuel tanker traffic flooding the refinery to load products.

Likewise, human and vehicular traffick have increased at Dangote-partnered filling stations. When our correspondent visited some filling stations within the Lagos metropolis at the weekend, motorists, as well as  individuals carrying jerry cans were seen jostling to buy fuel.

For instance, our correspondent saw several vehicles waiting in line to buy fuel at the rate of N875 at the expansive MRS station at Alapere, Ojota. The same situation played out at the Ardova filling station on the popular Ijaiye/Pen Cinema Road in Agege where a litre of petrol is sold for N870.

When our correspondent approached the managers of these fuel stations to know why the pump prices of their petrol are still high despite getting their supply from Dangote Refinery, the mangers told him they were still selling the old stocks they got from the refinery.

“The new price took effect yesterday (December 11th), so you can’t expect us to be selling the old products we still have in our tanks as a loss.

“I am sure that by the time you come back here on Saturday or Sunday, the new price regime would have been effected as we expect our remaining old stocks to be exhausted in the next few hours,” one of the managers at a Dangote-partnered filling stations assured our correspondent.

However, trading activities were slow at non-Dangote partner stations visited. The stations, including Mobil, Total including Mobil, TotalEnergies and NNPC Retail, were observed dispensing petrol at the rates of N885 to N910, about N15 to N25 more than what obtains at Ardova and MRS.

Marketers Heavy Losses

A manager at a TotalEnergies outlet in Ikeja, Lagos, lamented the decline in sales and revenue. According to him, many customers have abandoned the station since the start of a price war triggered by Dangote Refinery’s incessant price cuts.

“It is no longer a secret that Dangote is pushing cheaper fuel into the market, thus sparking a debilitating price war. Since all human beings want free or cheap gifts, it didn’t come as a surprise to us that they have been trooping to filling stations that are partnering Dangote Refinery.

“It is only those buying smaller quantities that patronise us now, and the supper rich that do not really care about the price differences. Majority of those filling up their tank or purchasing large quantities now go elsewhere,” the station manager lamented.

Asked why large volume buyers are abandoning his station for Dangote-partnered stations, he attributed it to a marked difference in savings.

“For those buying 50 to 120 litres of petrol, N15 to N25 on each litre is a lot of savings. Depending on each purchase, savings can rage from N5,000 to N20,000. But for those purchasing five to 10 litres, the gain of N75 and N150 is not worth the stress and cost of traveling more than a kilometre just for cheaper fuel,” he explained.

Unfortunately for non-Dangote partner stations stations, their already bad situation could get worse as last week’s major crash of petrol price by Dangote is expected to further exacerbate their troubles.

The owner of a fuel marketing company with many outlets across the country, who spoke to BH on the matter, lamented that the price crash came at a very bad time.

According to him, most filling stations owners got the fuel (petrol) they are currently selling at about N880 to N900 some days ago, making it practically impossible to compete with Dangote’s price.

“Even before Thursday’s price review, we were struggling to compete with him (Dangote). This latest move will surely deal a death blow to fuel importers and many marketers, who rely on them for supply.

“The pump price of petrol is expected to crash to between N715 to N740 from early next week. Unfortunately, apart from having huge stocks in ships and tanks purchased at premium rates still waiting to be discharged and lifted, we still have hundreds of millions of litres trapped and unsold in filling stations.

“I don’t see a tidy way out of this jam except the government comes in to take these products from us and sell to Nigerians at subsidized rates, which I don’t see happening,” said the fuel marketer, who asked that his identity be kept secret.

Integrated Market Chain

BH findings revealed that most filling in the country are either affiliated to or owned by tank farm owners, hence their inability to easily wean themselves of their influences.

“The owner of my filling station owns a major stake in a fuel depot located at Satellite Town, Lagos. That’s why we can’t easily abandon the depot for Dangote as people often advise us to do,” the manager of an independent fuel station told our correspondent.

Sources in the shipping and petroleum industries informed BH that embattled marketers had imported about three billion litres of petrol in anticipation of heavy demand by travellers during the Yuletide.

With Dangote crashing the price of his petrol below the N700 mark, the fate of the over two billion litres of unsold gasoline in fuel depots across the country now hang in the balance.

Using the N129 per litre difference between imported and Dangote fuel, energy and financial experts, who spoke on the matter, project that importers will be making a loss of N246 billion to N258 billion on the remaining two billion litres of petrol in their storage tanks if they decide to match Dangote’s rate.

According to the latest November 2025 Fact Sheet release by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), fuel marketers, including the Nigerian National Petroleum Company Limited (NNPCL), imported 1.563 billion litres of petrol into the country in November 2025.

Risky Venture

Introduced in November to strengthen transparency and provide real-time insight into fuel supply, consumption, and refinery performance across the country,  the NMDPRA data shows that marketers imported 52.1 million litres of petrol daily in November 2025. This amounted to 1.563 billion litres for the month.

The surge in November importation and sales, representing about 89 per cent increase when compared to the 82 million litres imported in October, according to industry sources, motivated the marketers to stock up more petrol for the Yuletide season.

Unfortunately, the two price reductions announced by Dangote in December, checks revealed, put spanners in the fuel importers calculations.

Meanwhile, BH reliably gathered at the weekend that embattled petroleum marketers have decided to shelve further importation of petrol in the near term to avoid incurring more losses.

Sources close to one of the marketers, who spoke to our correspondent on the matter, admitted that the frequent and unpredictable price adjustments by Dangote has drastically altered the dynamics of fuel supply and competition in the nation’s downstream market.

“While Dangote’s frequent price adjustments have widened the price gap between imported and locally refined petrol, Thursday’s cut has made petrol imports unviable.

“No marketer can compete with him. In fact, we are going to struggle to match Dangote’s lower prices and still remain profitable,” the source stated.