Dangote Reveals The Real Reason Why Fuel Prices Reduced
The president of the Dangote group revealed that the price drop for Premium Motor Spirit (petrol) during the festive season was brought on by market forces as opposed to deliberate efforts by marketers to ease the economic burdens that come with the festive season.
During an interview on Arise TV, the Nigerian billionaire highlighted that he too must protect the interests of his refinery.
“The price reduction is a response to the market, let me just put it that way. It is a refinery where we invested over $20bn and I think we have to try and protect our interests and also our investments,” he said.
On December 19th the Dangote refinery announced a reduction in the ex-depot price of petrol, to N899.50 per liter.
The downstream industry saw fierce pricing competition as a result, which compelled NNPCLto to lower its ex-depot price to N899 per liter.
To the pleasure of Nigerians, the refinery also announced that it will be partnering with MRS fuel station to offer fuel from its retail locations countrywide for N935 per liter.
During the interview, he also said that petroleum imports have a big impact on Nigeria’s foreign exchange, as seen in the Punch Newspaper.
“40 percent of our demand on foreign exchange is through people dealing in petroleum products and the more we allow imports to come in, not because I do not want imports, but the more we allow imports to come in, the more we keep using most of our foreign exchange out of the country because the majority of those letters of credit open for petroleum products and the goods are not coming into Nigeria,” he said.
Dangote’s fuel price reduction
As Nigerians geared up for the Yuletide season, which is often characterized by a lot of interstate travel, the Dangote refinery announced a reduction in fuel price, much to the surprise and delight of commuters.
“To alleviate transport costs during this holiday season, Dangote Refinery is offering a holiday discount on PMS.
From today, our petrol will be available at N899.50 per liter at our truck loading gantry or SPM,” Anthony Chiejina, Group Chief Branding and Communications Officer for Dangote Group had said at the time.
“Furthermore, for every liter purchased on a cash basis, consumers will have the opportunity to buy another liter on credit, backed by a bank guarantee from Access Bank, First Bank, or Zenith Bank,” he also disclosed.
The Dangote Refinery is the largest single-train refinery in the world, capable of producing 650,000 barrels per day.
It is said to have the potential to supply all of Nigeria’s energy demands for refined petroleum products, plus more for export.
