Nigeria’s downstream petroleum sector has entered the week with a sense of cautious optimism as depot prices for Premium Motor Spirit (PMS) and Automotive Gas Oil (AGO) remain largely stable.
Despite ongoing volatility in international oil markets, the local pricing environment reflects improved domestic supply mechanisms and increasing influence from local refining, particularly by the Dangote Refinery.
Resilience Amid Global Instability
The global oil market has been anything but quiet. Crude benchmarks such as Brent and WTI recorded slight movements last week, with Brent closing at $65.03 and WTI at $62.33 on Monday, May 19. However, these fluctuations had limited impact on depot-level fuel pricing in Nigeria, where PMS and AGO prices showed either stability or only marginal reductions.
This relative calm in the local market highlights the stabilizing effect of domestic refining and strategic stock controls adopted by major depots.
Depot-Level Price Movements: Comparing May 16 vs. May 19
Premium Motor Spirit (PMS): Subtle Adjustments, Broader Stability
- Dangote (Lagos): Declined from ₦837 to ₦834 (₦3 reduction), indicating price competitiveness amid increased refining output.
- NIPCO (Lagos): Unchanged at ₦840, showing market steadiness.
- AIPEC (Lagos): Slight decrease from ₦837 to ₦836.
- Menj (Lagos): Maintained at ₦837.
- Rainoil (Lagos): Significant dip from ₦870 to ₦840 (₦30 drop), suggesting price correction in response to broader market alignment.
- Matrix (Warri): Dropped from ₦890 to ₦870, reinforcing a price softening trend in Delta State.
- Zamson (Warri): Lowered from ₦880 to ₦865.
These movements reflect increased alignment between depots and local refiners, who continue to adjust prices to maintain competitiveness in the face of high logistics costs and evolving demand.
Automotive Gas Oil (AGO): Slight Price Reductions Across Several Depots
- Dangote (Lagos): Reduced from ₦937 to ₦926, reinforcing its appeal among bulk buyers and distributors.
- Rainoil (Lagos): Held steady at ₦970.
- AA Rano (Lagos): Saw a minor dip from ₦925 to ₦920.
- Pinnacle (Warri): Edged down from ₦963 to ₦959.
- Matrix (Warri): Lowered from ₦965 to ₦960.
- Zamson (Warri): Trimmed from ₦960 to ₦959.
- Fynefield (Calabar): Remained stable at ₦995, the highest recorded AGO price in the South-South region.
- Bulk Strategic (Port Harcourt): Maintained at ₦977, reflecting consistent distribution margins.
Local Refining Dominates Price Influence
Industry observers have noted the growing impact of local refining activities on pricing dynamics. According to Olatide Jeremiah, CEO of Petroleumprice.ng, “The consistent pricing across Dangote and other domestic depots suggests that Nigerian refineries are beginning to play a stabilizing role in a traditionally import-dependent market.”
He further emphasized that “as the refining capacity of the Dangote facility scales and operations normalize at other refineries, including Port Harcourt and Kaduna, the buffer against import-linked price shocks will strengthen.”
Regional Snapshot: Steady Across the Board
- Lagos: The majority of depots posted unchanged or marginally lower prices for PMS and AGO. Notably, Rainoil’s ₦30 drop in PMS was one of the sharpest adjustments.
- Warri: Depots like Matrix and Zamson showed slight reductions in both PMS and AGO, reflecting synchronized pricing strategies.
- Port Harcourt and Calabar: Depots such as Bulk Strategic and Fynefield maintained their prices, likely due to regional transportation costs and logistical factors.
This uniformity in prices across regions signals a maturing pricing mechanism that responds not only to global trends but also to localized economic conditions.
Infrastructure Still a Bottleneck
Despite the benefits of local refining, Nigeria’s fuel distribution is still hampered by poor road infrastructure. According to marketers, the cost of transporting diesel (AGO) remains elevated, particularly for inland and northern states. This often offsets any depot-level price advantage gained from local refining or tariff adjustments.
Stakeholders Monitor Global Signals
While current price levels are favorable for both retailers and end consumers, experts caution that market dynamics can shift quickly. “If crude oil prices spike beyond current thresholds due to geopolitical or economic triggers, depot prices in Nigeria will inevitably feel the ripple,” warns Bayo Adelaja, a veteran marketer based in Lagos.
For now, he notes, “stability is our friend, but vigilance is necessary.”
Outlook: Cautiously Positive
The outlook for depot prices remains encouraging in the short term. As refining capacity expands and government-backed infrastructure initiatives gain momentum, stakeholders are hopeful for a more predictable pricing environment.
However, long-term stability hinges on:
- Sustained output from local refineries.
- Improvements in road and distribution infrastructure.
- Global crude price moderation.
As such, marketers, regulators, and consumers are urged to keep a close eye on both local developments and international oil trends.
