Marketers Warn of Petrol Price Increase as Dangote Stops Petrol Sales in Naira

• Oil marketers have warned that there may be a rise in petrol pump prices in the coming days
• This comes after Dangote Refinery decided to stop selling petroleum goods to the domestic market in Naira
• According to a petrol marketer, members may also decide to offer their petroleum products in US dollars

Legit.ng journalist Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

Following Dangote Refinery's decision to halt the sale of petroleum products in Naira to the domestic market, oil marketers have issued a warning that gas pump prices could increase in the days ahead.

The refinery and the Federal Government had been negotiating the extension of their six-month crude-for-Naira contract with NNPC Limited.

Two weeks ago, the national oil corporation ended the arrangement, which was supposed to expire this month.

In Abuja on Tuesday, negotiations between the government and the parties involved came to a standstill.

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Dangote Refinery halts sale of fuel in naira, gives reasons

Dangote Refinery in a statement on Wednesday said:

“We wish to inform you that Dangote Petroleum Refinery has temporarily halted the sale of petroleum products in Naira. This decision is necessary to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in U.S. dollars.

Marketers react

According to Chief Chinedu Ukadike, Public Relations Officer for the Independent Petroleum Marketers Association of Nigeria (IPMAN), the cost of obtaining foreign currency to pay for the product would probably result in an increase in pump prices.

Since the dollar has now become the currency of exchange in Nigeria, he noted, marketers may also turn to selling their petroleum products in dollars.

“The pressure on dollar will increase because it has become the means of exchange. Marketers will begin to sell petrol at filling stations in dollars. And this will have negative impact on the prices of petroleum products across the country.

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“We don’t want to cause panic in the energy industry but what we are seeing now is not encouraging. Any increase in cost will be passed on to consumers eventually”, he added.

Naira for crude ended

The IPMAN member said that, in contrast to what government officials had claimed, the marketers were told that the crude for Naira contract expired on March 1, 2025.

Last week, Senator Heineken Lokpobiri, the Minister of State for Petroleum Resources (Oil), assured reporters that the Naira-for-Crude agreement between NNPC Limited and Dangote Refinery was still in place and had not been cancelled.

He emphasized that the agreement was still in force as it was authorized by the Federal Executive Council (FEC).

Lokpobiri added that players in the oil and gas sector were allowed to conduct business in any currency, despite the fact that NNPC follows a private sector model and the government still has little influence over important choices.

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According to him,

“Government is not canceling it. What was taken to council was a pilot scheme where they said NNPC should be selling crude in Naira to Dangote Refinery. We’ve always encouraged people to buy crude in whatever currency. Even if you buy in Naira, it’s going to be at a prevailing exchange rate.

Oil marketers deny opposing NNPC, Dangote petrol price

Legit.ng reported that the Independent Petroleum Marketers Association of Nigeria has denied claims that it opposed the recent reduction in Premium Motor Spirit (petrol) prices by Dangote Refinery and the Nigerian National Petroleum Corporation Limited.

There have been reports that oil marketers are unhappy with the reduction due to the losses they incurred from the price changes. Also,

Former presidential aide Reno Omokri alleged in a post on his verified X (formerly Twitter) handle on Saturday night that IPMAN was protesting against the Federal Government due to the affordability of fuel from Dangote and NNPCL.

Source: Legit.ng