Nigeria’s petrol market has experienced dramatic volatility since the Dangote Refinery began supplying fuel in September 2024, despite hopes for price stability. Data from the National Bureau of Statistics (NBS) shows that within 10 months, pump prices fluctuated at least 10 times, driven by changes in global crude prices, exchange rates, and refinery pricing strategies.
At its debut, petrol averaged ₦1,030.46 per litre in September 2024, before rising steadily through the last quarter of the year—₦1,184.83 in October, ₦1,214.17 in November, and ₦1,189.12 in December. The new year brought fresh increases, with January 2025 averaging ₦1,258.34 and March hitting a peak of ₦1,261.65, about 22% higher than the September baseline. However, prices later fell sharply, reaching ₦1,027.76 in May and stabilizing around ₦1,037.66 in June, leaving the market nearly back to its starting point.
Analysts attribute these fluctuations to global crude dynamics and Dangote Refinery’s pricing approach. Acting as the sole large-scale domestic supplier, Dangote has adjusted ex-depot prices multiple times—cutting from ₦950 to ₦890 per litre in February and again to ₦820 in August. “Prices cannot go lower than crude and refining costs,” explained oil analyst Ezenwa Odiri, noting that Nigeria would need subsidies to drive prices down further. Jide Pratt of TradeGrid added that Dangote applies dynamic pricing, influenced by crude costs, local demand, and competition with imports.
For consumers, the price swings have been a heavy burden. Transport operators and households have struggled to plan budgets amid sudden hikes, especially during the March peak. “You wake up one week and petrol has jumped again. How do you plan your life like that?” lamented Lagos driver Tunde Ajayi. Although May’s price dip offered temporary relief, uncertainty persists, worsening inflation’s impact on living costs.
Industry experts suggest that some volatility stems from the refinery’s transitional phase. While designed to process 650,000 barrels per day, Dangote’s facility is still scaling output and overcoming distribution bottlenecks. As operations stabilize and supply chains improve, analysts expect pricing to become more predictable. Until then, Nigerians will continue navigating a volatile fuel market, despite the promise of local refining.
Source: Business Day