Major oil marketers in Nigeria are set to directly purchase Premium Motor Spirit (PMS) from the Dangote Petroleum Refinery between Thursday and next week, following the Nigerian National Petroleum Company Limited’s (NNPCL) decision to step down as the sole off-taker. Multiple sources confirmed that this shift opens the market for more downstream players to engage with the $20 billion Dangote plant.
This development signals the end of the Federal Government’s petrol subsidy, as NNPCL will no longer subsidize Dangote’s petrol for marketers. Previously, NNPCL was shouldering about N3.3 billion daily to maintain lower pump prices. The move comes amidst reports that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has released new, higher petrol prices, although no official confirmation has been given.
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Oil marketers, while yet to start direct purchase, have confirmed that a directive was issued to stop buying PMS through NNPCL. They expect prices to rise once stock from NNPCL is exhausted, and Dangote refinery releases its pricing.
With this policy shift, petrol prices are expected to increase significantly across various cities, as shown by a new price template. For example, Abuja’s indicative price is forecasted to rise to N1,029.01 per litre, while Lagos may see prices at N991.21 per litre.
