With the declining price of Dangote Refinery products, pressure is mounting on fuel importers to lower petrol prices. However, many importers are resisting, arguing that the high landing cost of imported fuel makes price reductions unfeasible.
According to industry data, the estimated landing costs for petrol at the Apapa/ASPM Jetty are as follows:
- PMS (Petrol): ₦969.33/Litre (30-day average), Spot (ASPM) at ₦927.48/Litre, Spot (NPSC) at ₦927.53/Litre
- AGO (Diesel): ₦1,097.61/Litre (30-day average), Spot at ₦1,047.59/Litre
- ATK (Aviation Fuel): ₦1,179.88/Litre (30-day average), Spot at ₦1,046.38/Litre
Importers argue that these figures make it difficult to compete with Dangote Refinery’s prices without incurring heavy losses.
Importers Struggle with Market Pressures
A key concern for importers is the volatility of exchange rates. With the naira fluctuating against the dollar, securing forex at competitive rates has become increasingly difficult. This directly impacts landing costs, making it challenging for importers to sell at lower prices without running at a loss.
An importer, speaking on condition of anonymity, stated:
“We are not against price reductions, but we cannot sell below our landing cost. The government needs to address forex access and stabilise the market before we can consider any adjustments.”
Dangote Refinery’s Impact on the Market
Dangote Refinery’s pricing strategy has placed immense pressure on independent importers, as its locally refined products are expected to be cheaper in the long run. While this is beneficial to consumers, it puts importers in a difficult position, forcing them to justify their higher prices.
A market analyst noted:
“Dangote Refinery is a game-changer, but existing importers still have high inventories purchased at a higher cost. They can’t afford to take huge losses overnight.”
Calls for Government Intervention
Industry stakeholders are calling on the government to intervene by reviewing taxes, levies, and access to forex. Without policy adjustments, independent importers fear they may be forced out of business, leaving the market solely in the hands of local refiners.
A senior executive at a major marketing firm said:
“If the government wants a competitive market, they must ensure a level playing field. Importers should get the same forex advantages as local refiners to avoid market distortions.”
What’s Next for Petrol Prices?
For now, petrol prices remain uncertain. While Dangote Refinery’s operations may eventually lead to price reductions, importers warn that unless forex and landing costs are addressed, fuel prices may not drop significantly in the short term.
Consumers will have to wait and see how the market adjusts in the coming weeks.
