A new round of price competition is brewing in Nigeria’s downstream petroleum sector, as several private depots in Lagos quietly reduced their ex-depot prices for major petroleum products, undercutting the Dangote Petroleum Refinery.
Petroleumprice.ng can confirm that private marketers are now lifting Premium Motor Spirit (PMS) at rates significantly lower than Dangote’s benchmark. At the time of filing this report, Aiteo and Nipco are both selling PMS at ₦870 per litre, while Aipec is quoting ₦874. This contrasts with Dangote’s ex-price of ₦880, which remains about ₦10 higher, according to marketers familiar with the latest lifting figures.
Similarly, prices of Automotive Gas Oil (AGO), commonly known as diesel, have stabilised at ₦1000 per litre across multiple depots, including African Terminal, Ibachem, Menj, Mao, Ibeto, and Integrated Oil. Rainoil, however, posted a slightly higher price of ₦1003/litre, while Dangote’s price stands at ₦1023/kg.
In the Liquefied Petroleum Gas (LPG) segment, Ardova is offering product at ₦890 per litre, marking another notable undercut of market averages.
Market Reaction: Pressure on Dangote
These competitive adjustments by private depots have sent a clear signal across the value chain. Marketers, particularly independent and major marketers who had been lifting from Dangote’s facility, are reportedly reconsidering their supply sources due to the increasing price disparity.
“Marketers will naturally gravitate toward cheaper sources to maintain their margins,” a depot manager told our correspondent. “The private depots are now aggressively matching and even beating Dangote’s price, and that’s already influencing lifting patterns.”
With Dangote maintaining a premium price on its products, industry analysts say the refinery risks losing traction if it does not realign its pricing with the emerging market realities. The current ex-depot pricing by private operators could force Dangote into a review sooner than anticipated, especially as petrol volumes decline at its loading gantries.
Sector Dynamics
The shift comes amid broader concerns within the downstream sector over refining margins, FX liquidity, and the cost of vessel chartering factors that have placed sustained upward pressure on pump prices in recent months. Dangote’s refinery, which had initially set a pricing benchmark above market average upon rollout, now faces a fast-evolving marketplace where private depot owners are demonstrating greater flexibility.
What appears to be unfolding is a decentralisation of pricing power, as private depots become more aggressive in winning market share. This could mark the beginning of a sustained price correction, especially if Dangote opts not to react swiftly.
With PMS and AGO now available at significantly lower rates across several Lagos depots, the downstream sector is witnessing the early stages of a price realignment. Whether Dangote will hold its pricing or respond to pressure from the market remains to be seen. However, one thing is clear: the days of passive market leadership may be over, as competition gains ground and pricing power shifts to more dynamic players in the private depot space.
