Fuel Prices Drop as Filling Stations Slash Petrol Pump Rates Amid Competition
Motorists in parts of Lagos and Ogun states are beginning to enjoy lower fuel costs as several filling stations have reduced the pump price of Premium Motor Spirit (petrol) to an average of N1,205 per litre, following a recent cut in gantry prices by the Dangote Petroleum Refinery.
Checks along the Lagos-Ibadan Expressway showed that many retail outlets have lowered their petrol prices from an average of N1,280 per litre in a bid to attract customers and remain competitive in the increasingly dynamic downstream market.
The price adjustments have triggered stiff competition among marketers, with stations offering lower rates witnessing higher patronage than their counterparts selling at higher prices.
Among the stations surveyed, SGR filling station in Mowe recorded the lowest pump price, dispensing petrol at N1,199 per litre as of Saturday.
Other marketers, including NIPCO, SAO, AP and MRS, sold petrol at N1,205 per litre, while Mobil outlets offered the product at N1,220 per litre. Heyden sold petrol at N1,285 per litre in Iperu and N1,210 per litre in Ibafo, underscoring the varying pricing strategies along the corridor. Retail outlets operated by the Nigerian National Petroleum Company Limited (NNPCL) maintained a pump price of N1,245 per litre.
The latest reductions followed a decline in global crude oil prices after tensions in the Middle East eased. The drop prompted the Dangote refinery and several private depot operators to review their fuel prices downward, raising expectations of further relief for consumers.
Industry stakeholders, however, noted that price adjustments would likely be gradual as marketers seek to avoid substantial losses on fuel stocks purchased at higher rates.
Crude oil prices had surged to about $120 per barrel during the height of the United States-Iran conflict but later retreated to around $80 per barrel following a peace agreement between both countries.
In response to the market shift, the Dangote refinery reduced its petrol gantry price by N75 per litre, cutting the rate from N1,250 per litre to N1,175 per litre. During the period of heightened tensions, pump prices had climbed from about N830 per litre to over N1,300 per litre.
The refinery’s decision triggered similar price reductions among private depot operators, many of whom adjusted their rates to approximately N1,180 per litre.
Meanwhile, data from petroleumprice.ng showed that the Dangote refinery also reduced its diesel gantry price by N100, bringing it down from N1,600 to N1,500 per litre. The adjustment represents a 6.25 per cent reduction and marks the second diesel price review within a week, following an earlier cut on June 16.
Despite the reductions, many Nigerians argue that current pump prices do not adequately reflect the sharp decline in international crude oil prices.
Responding to the criticism, a source within the Dangote Group explained that the refinery was still processing crude purchased during the period of elevated global prices and therefore could not immediately pass on the full benefits of the market decline to consumers.
“Crude prices are still fluctuating. Those making such comments either do not understand the business or are being insincere. They should compare prices across Africa and other parts of the world,” the source said.
The source added that petrol prices could eventually fall to as low as N900 per litre if favourable market conditions persist, but stressed that the refinery must first exhaust its inventory of higher-priced crude oil.
The latest price reductions are expected to intensify competition among marketers and could pave the way for further downward adjustments in the coming weeks if crude oil prices remain stable.
By Dare Olawin