Private petroleum depots have fired the first shot in what appears to be an escalating fuel price war with the Dangote Refinery. As of today, several private depots in Lagos closed Premium Motor Spirit (PMS) sales at ₦839/litre one naira below Dangote’s ₦840/litre mark signalling a bold move to reclaim market share and unsettle Dangote’s emerging dominance in the downstream sector.
Strategic Undercut Amid Market Tensions
Industry insiders confirm that the pricing strategy by independent depot owners is not coincidental. It’s a calculated pre-emptive strike to undercut Dangote Refinery ahead of its highly anticipated nationwide logistics expansion. Dangote is expected to deploy 4,000 fuel trucks by August 15, a move that could significantly alter distribution economics and pressure depot margins.
“This is a market takeover war. The independents are pricing aggressively now to discourage retailers and marketers from switching fully to Dangote products,” a downstream analyst familiar with depot operations told Petroleumprice.ng.
As of July 2, the following Lagos-based private depots were offering PMS at ₦839/litre:
- First Royal
- MENJ
- MAO
- AITEO
These depots are taking tight-margin positions just to hold onto their customer base and deter further migration toward Dangote’s growing supply chain. Their strategy: move fast, price lower, and maintain market relevance.
Dangote May Review Price
In response to this pricing pressure, sources within the downstream value chain reveal that Dangote may initiate a price review by July 3. The review is expected to match or beat the ₦839/litre benchmark now set by competitors.
“The private depots are not sleeping. They’ve realised Dangote is not just another supplier but a market rewriter. So they are fighting with the only tool they have: price,” said a trader at Ibru Jetty.
PMS Focused Battle, AGO Prices Stable
Diesel (AGO) prices have stayed largely stable across depots, but the real battle is now centred on PMS the high-demand, high-volume product driving consumer pump prices and transport costs. Dangote’s refinery-backed supply edge is fuelling intense competition, and the pressure is rising fast.
Marketers remain torn. Many acknowledge Dangote’s superior product handling and logistics reliability, but today’s lower depot prices offer immediate relief on cost, especially for independent marketers operating on thin margins.
Market Outlook
If Dangote reduces its gate price below ₦839 in the coming days, it could spark a broader realignment of depot pricing strategies. However, such a move may place financial strain on weaker depots reliant on dollar-based imports and offshore sourcing.
What is certain is that Nigeria’s downstream market has entered a new era of price-led competition, driven by refinery power and logistic scale. For now, retailers and end consumers may benefit from this clash but the long-term implications on sustainability remain to be seen.
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