The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has accused Dangote Refinery of attempting to stifle competition in Nigeria’s petroleum market by setting high petrol prices and discouraging other players from entering the market.
This accusation comes after Dangote Refinery publicly claimed that marketers complaining about its pricing intend to import substandard fuel at lower rates.
In a statement on Monday, PETROAN spokesperson Joseph Obele dismissed Dangote’s accusation as a tactic to maintain monopoly in the downstream sector. He argued that competition is essential for consumer value and expressed concern that a monopoly would lead to inflated prices.
According to Obele, PETROAN is committed to providing consumers with high-quality fuel at lower prices and has coordinated with foreign partners to start importing premium petrol for the Nigerian market by December 2024, pending regulatory approvals.
“Intensive competition in any market brings the best value for consumers, and this sector should be no different,” Obele stated. “Contrary to competition, a monopoly market is exploitative and primarily driven by profiteering.”
Dangote Refinery, which recently disclosed a selling price of N990 per litre for petrol transported by truck and N960 for ship delivery, defended its pricing by comparing it to international rates.
PETROAN, however, argued that Dangote’s price point fails to account for the financial concessions it received from the government, including foreign exchange advantages.
“It’s unreasonable to base domestic petrol prices solely on international rates, especially given the government’s support for Dangote’s project,” said Obele. “PETROAN believes the price should reflect actual production costs plus a fair margin, not an arbitrary comparison to international standards.”
Obele also criticized Dangote Refinery for suggesting that only substandard petrol could be sold at a price lower than its current rate. PETROAN’s response emphasized the association’s commitment to quality and reassured the public that it would not engage in unethical practices.
PETROAN further praised President Bola Tinubu’s efforts to overhaul Nigeria’s refineries, advocating for privatization of the government-owned Port Harcourt and Warri refineries to increase sector competition. They called for a transparent privatization process to avoid monopolistic practices.
PETROAN concluded its statement by urging the federal government to intervene to prevent monopolies and promote an inclusive, competitive petroleum market.
They proposed an industry-wide meeting with stakeholders, including IPMAN, DAPPMAN, and labor unions, to address pricing challenges in the downstream sector.
This exchange underscores growing tensions in Nigeria’s downstream petroleum market, as players like PETROAN and IPMAN strive to counter Dangote Refinery’s market influence, advocating for a competitive environment to ensure fair pricing and supply stability for consumers.
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