“We Struggle to Sell”: Dangote Refinery Accuses Oil Marketers of Low Patronage, Takes Action
- Dangote Refinery said it is struggling to sell diesel daily due to low patronage from petroleum marketers
- When the refinery began production, it reduced the price of diesel from N1,200 to N1,000, and later to N900 per litre
- The low patronage has forced Dangote Refinery to export most of its diesel and aviation fuel to other countries
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Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
Dangote Refinery has raised concerns over the lack of patronage from Nigerian oil marketers due to low pricing strategies on its product sales.
Source: Getty Images
Devakumar Edwin, Vice President of Dangote Industries Limited, disclosed these challenges during a X Spaces session organised by Nairametrics, BusinessDay reports.
According to Edwin, the refinery struggles daily to make diesel and aviation fuel sales, which is why it has decided to export its products instead.
He said:
“Over 95% of petroleum product importers in Nigeria are not buying from Dangote Refinery. The refinery struggles to sell about 29 tankers of diesel per day due to low patronage from local importers
“As a result of this poor local patronage, Dangote Refinery exports most of its diesel and aviation fuel."
More accusations to marketers
Edwin also noted that petroleum product marketers in Nigeria have formally complained to President Bola Tinubu, citing the refinery’s local pricing strategy as detrimental to their businesses.
Prices of diesel from the refinery have dropped from N1,200 to N1,000 and now to N900 per litre, a move intended to boost competitiveness but apparently causing friction with local marketers.
Earlier, Edwin warned that Dangote would prioritise exporting its products if the Nigerian National Petroleum Company Limited (NNPC) and other petroleum dealers continue to avoid purchasing from the refinery.
He added:
“We have been exporting aviation fuel, producing kerosene, producing diesel, but yesterday, we started the production of PMS. So, that was the last stage. The only thing now left out is petrochemicals."
Dangote refinery import 11 million barrels of crude from US
Legit.ng previously reported that while looking to begin production in July, the Dangote refinery imported 11 million barrels of crude oil from the US.
The refinery has placed a tender for five million barrels of West Texas Crude and another six million barrels for September.
The refinery management has accused international oil companies (IOCs) of inflating premium prices above international costs.
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Source: Legit.ng
