Dangote Refinery Says Petrol, Diesel Prices Are Being Subsidised Amid Rising Crude Oil Costs

A senior official of the Dangote Group has disclosed that the Dangote Petroleum Refinery is currently subsidising the prices of petrol and diesel supplied to the Nigerian market. The official said the company’s ex-depot petrol price of N1,200 per litre is below what would be considered a fully competitive market rate, given the recent surge in global crude oil prices.

According to the source, who spoke on condition of anonymity, the sharp increase in oil prices followed geopolitical tensions in the Middle East, particularly disruptions linked to the US-Iran conflict. This led to Brent crude rising from about $66 per barrel in February to over $100 per barrel after the Strait of Hormuz was reportedly affected.

The official explained that while the refinery is trying to cushion the impact on Nigerians by optimising petrol (PMS) and diesel (AGO) prices, it cannot extend the same level of support to aviation fuel. As a result, jet fuel is being sold at market-reflective rates, despite earlier claims of pricing adjustments within the company.

However, another Dangote Group source revealed that aviation fuel is still being supplied at relatively lower rates compared to market averages, with prices reportedly ranging around N1,799 per litre—below the N2,700 to N3,500 range being reported by airline operators. The company maintained that its pricing structure remains competitive despite global supply pressures.

The development comes amid growing concerns from airline operators, who have warned that rising Jet A-1 fuel costs are threatening operations and could lead to flight disruptions. Industry stakeholders continue to debate the true market price of aviation fuel, with marketers citing global supply constraints while airlines insist the increases are excessive and unsustainable.

source: punch