Key points
- Dangote Petroleum Refinery has announced a new N50 per litre reduction in the ex-depot price of Premium Motor Spirit (PMS).
- The latest cut brings the cumulative decrease in the refinery’s PMS price to N200 per litre since May 30, 2026, lowering the gantry price to N1,075.
- Over the same month-long period, ex-depot prices for Automotive Gas Oil (AGO) and Jet A1 aviation fuel dropped by N300 and N520 per litre, respectively.
- The company explained that current supplies are processed from older crude inventories bought at higher rates, averaging $124.80 per barrel in May and $95.25 in June.
Main story
Dangote Petroleum Refinery & Petrochemicals has announced another reduction in the ex-depot price of Premium Motor Spirit (PMS), marking its fourth price cut within a month. The company stated that it continues to pass lower production costs to consumers despite still processing crude oil purchased at significantly higher international prices.
The latest N50 per litre reduction brings the cumulative decrease in the refinery’s PMS ex-depot price to N200 per litre since May 30, 2026, reducing the gantry price to N1,075. Over the same period, the refinery has also reduced the ex-depot price of Automotive Gas Oil (AGO) by N300 per litre and Jet A1 aviation fuel by N520 per litre.
The company said the successive reductions demonstrate its commitment to ensuring Nigerians benefit from favourable market developments while maintaining the long-term sustainability of domestic refining operations. In a statement issued on Thursday, the Dangote Refinery explained that petroleum product pricing cannot mirror daily movements in international crude oil markets because crude is purchased weeks, and sometimes months, before it is processed. According to the refinery, the petroleum products currently being supplied to the market are being produced from crude inventories acquired during periods of substantially higher prices.
It disclosed that the average landed cost of crude processed stood at approximately $124.80 per barrel in May and $95.25 per barrel in June, compared with the current international benchmark of about $71.01 per barrel. The refinery also clarified that its crude procurement costs are not based solely on the headline ICE Brent benchmark commonly quoted in the media. Rather, crude is purchased on a Dated Brent basis together with applicable market premiums, freight, and logistics costs, resulting in actual feedstock costs that differ materially from benchmark prices.
Despite the sharp increase in crude acquisition costs during the period, Dangote Refinery said it deliberately refrained from transferring the full impact to consumers, choosing instead to absorb a significant portion of the additional costs in order to support market stability and cushion Nigerians from the volatility in global energy markets. The company noted that this pricing approach has helped to keep petroleum product prices in Nigeria below those prevailing in neighbouring countries, even after accounting for applicable taxes. It added that as lower-priced crude cargoes progressively enter its production cycle, the refinery has begun systematically passing the benefits to the market through phased price reductions.
The refinery emphasized that Nigeria is now benefiting from the stabilising role of domestic refining capacity. The facility currently supplies volumes sufficient to meet national demand, helping to strengthen energy security, eliminate dependence on imports, conserve foreign exchange, and provide greater price stability for consumers and businesses.
The company expressed confidence that if international crude prices remain favourable and lower-cost feedstock continues to replace higher-priced inventories, Nigerians should expect further moderation in petroleum product prices. Dangote Petroleum Refinery reiterated its commitment to supplying high-quality, internationally certified petroleum products at competitive prices while supporting Nigeria’s economic growth and the long-term development of the country’s downstream petroleum sector.
The issues
The pricing lag highlights the operational complexity of oil refining, where global benchmark drops do not instantly translate to domestic relief due to forward-purchased feedstock. While consumers demand immediate parity with falling global oil prices, the refinery has had to manage high-cost inventories from May and June while absorbing losses to protect local market stability.
What’s being said
“Today’s N50 per litre reduction is the fourth price cut in one month, bringing cumulative reductions to above N200 per litre on PMS. This approach ensures that pricing decisions are anchored on actual production economics and inventory costs rather than short term fluctuations in international oil markets.” — Dangote Petroleum Refinery Statement
What’s next
Consumers can anticipate further phased price reductions across PMS, AGO, and Jet A1 fuels in the coming weeks as cheaper crude shipments bought closer to the current $71 benchmark progressively hit the refinery’s production lines.
Bottom line
Dangote Refinery is leveraging its massive domestic refining capacity to buffer local consumers from international price volatility, systematically cutting fuel prices as cheaper inventory enters production, while simultaneously driving national energy self-sufficiency.
