The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has voiced strong concerns over the pricing of petrol by the Dangote Petroleum Refinery, which is set at N990 per litre.
PETROAN has described this price as “inconsiderate” and argues that imported petrol currently costs less, with a recent estimate showing that the landing price for imported fuel is around N978 per litre as of October 31, 2024.
The association emphasizes that Dangote’s refinery received significant foreign exchange concessions during its construction, which PETROAN believes should have resulted in a more affordable price for consumers.
In a statement on Monday, PETROAN’s Publicity Secretary, Joseph Obele, responded to claims by Dangote that PETROAN and other groups plan to import substandard fuel. Obele asserted that PETROAN is working towards offering Nigerians high-quality fuel at more competitive rates, pending regulatory approval for imports.
“PETROAN will sell far less than the current selling rate of PMS in Nigeria when granted an import licence,” he stated. He further criticized Dangote’s strategy, describing it as an attempt to establish a monopoly and block other suppliers from the market.
Obele clarified that PETROAN’s aim is to create a balanced market, where competition would drive down costs and benefit consumers.
“Consumers get the best value for pricing when competition is at its peak, hence Competition should be encouraged. Contrarily to competition, such a market will be exploitative and strictly for profiteering.
“The publication by Dangote refinery that PETROAN will import substandard petroleum products is not coming as a surprise to stakeholders, because such is his usual gimmick for maintaining a monopoly. The publication was coming after PETROAN and IPMAN announced plans to sell far less than the current Selling rate of PMS in Nigeria.
“It is important to set the records straight that PETROAN has never compared the price of Dangote PMS with any, other than the fact that Dangote’s PMS price wasn’t known until this morning at the press release by Dangote Refinery,” Obele said.
“PETROAN has concluded plans with its foreign refinery counterparts and financial partners to import the best quality of PMS and then sell far less than the present selling rate of PMS in Nigeria. We planned to enter the market before December 2024, pending the approval of our import permit license by the regulatory agency and access to foreign exchange from CBN at the official rate.”
The PETROAN spokesman maintained that before now, the Dangote refinery had refused to make public its selling rate of PMS until IPMAN and PETROAN announced their readiness to sell at prices less than the current prices.
“The rate of N990 as announced by Dangote refinery was inconsiderate based on the fact that Dangote refinery enjoyed massive concessions for accessing foreign exchange during the construction of the refinery.
“The core determinant for setting the price is a consideration of the cost of production, then adding a fair margin. But this wasn’t the case for the determinant of PMS price by Dangote refinery as they said ‘the parameter was comparison with the international selling rate at the global market’.
“A nation that gave you a yet-to-be-disclosed concession for foreign exchange which was highly criticised by financial experts, such a country pricing template shouldn’t have been templated by the selling rate at the international market but rather it should have been the cost of production plus fair margin,” Obele stressed.
He added that goods from Chinese markets are not as costly as goods from the American market because the cost of production differs.
“The allegations that PETROAN will import inferior products and also that an international company is trying to establish a PMS blending plant in Lagos are all strategies for Dangote refinery to push others out of the market to achieve a monopoly for exploitation.
