Nigeria’s downstream petroleum sector is undergoing one of the most dramatic and disruptive transformations in its history as a deepening price war, triggered by the Dangote Petroleum Refinery, sends shockwaves through fuel markets nationwide. What began as a strategic price cut has now escalated into a full-scale battle for survival among marketers, importers, and retailers, fundamentally altering pricing structures, consumer behavior, and long-standing power dynamics in the oil and gas industry.
Across Lagos, Ogun, and other strategic corridors, motorists are voting with their wallets. Filling stations selling Premium Motor Spirit (PMS), popularly known as petrol, at prices deemed “too high” are being deserted, while those aligned with the Dangote refinery’s new pricing regime are witnessing unprecedented queues. The message from consumers is unmistakable: price now determines patronage, and loyalty in Nigeria’s fuel market has become ruthlessly transactional.
At the center of this upheaval is the Dangote Petroleum Refinery, Africa’s largest and the world’s biggest single-train refinery, which last week stunned depot owners and fuel marketers by slashing its gantry price by N129 per litre—from N828 to N699. The decision instantly reset market expectations and placed enormous pressure on marketers who had stocked petrol at higher costs, particularly importers grappling with elevated landing prices.
Within days, the impact rippled across the downstream sector. MRS Oil Nigeria Plc, one of Dangote’s key retail partners, began selling petrol at N739 per litre in Lagos and Ogun states, a move that effectively undercut competitors still selling above N800 or even N900 per litre. The result was immediate and dramatic. Long queues formed at MRS stations, while neighboring outlets struggled to attract customers.
In communities like Alapere in Lagos, scenes reminiscent of the subsidy era returned—not due to scarcity, but due to affordability. Motorists deliberately bypassed nearby stations selling petrol above N800 to queue at MRS outlets dispensing Dangote-produced fuel at significantly lower prices. The pattern quickly replicated itself across major highways and urban centers.
As the days progressed, the market began to buckle under consumer pressure. Retail outlets that had initially resisted lowering prices were forced to reconsider. From Lagos to Ogun, filling stations slashed pump prices by as much as N100 per litre, even when such reductions meant selling below their cost of purchase. The severity of the price war became evident: survival, not profit, had become the immediate priority.
Industry insiders confirm that the current pricing environment is unsustainable for many marketers. Several stations are reportedly selling petrol at a loss simply to retain customers and maintain cash flow. For some, the choice is stark—absorb losses now or risk total market irrelevance.
According to a senior oil marketer who spoke anonymously to avoid victimisation, the widespread availability of MRS stations has amplified the crisis. “There is almost an MRS in every neighborhood,” the marketer said. “That alone has changed everything. Buyers now have options, and once they see cheaper petrol, they won’t return to higher-priced stations. This is a major concern for traders nationwide.”
Checks across Lagos and Ogun on Sunday confirmed widespread price adjustments. SGR filling station in Ogun sold petrol at N750 per litre, while Petrocam in Mowe dropped its price to N785. Both had previously sold close to N900. Mobil outlets along the Lagos-Ibadan Expressway adjusted prices to N780, while Akiavic sold at N799. Habeeb, Eternal, and Asharami stations followed suit with varying reductions, though some still struggled to match the N739 benchmark set by MRS.
Yet, even these reductions came at a heavy cost. Market data indicates that many of the price cuts are occurring well below the landing cost of imported petrol, estimated at about N828 per litre. This reality has placed importers, including the Nigerian National Petroleum Company Limited (NNPC), in an increasingly precarious position.
NNPC, once the sole importer of petrol during the subsidy era, has also been forced into price adjustments. The state-owned oil firm reduced pump prices from N875 to between N825 and N840, depending on location. However, analysts say even these revised prices struggle to compete with Dangote’s N699 ex-depot price and N739 pump price, effectively placing NNPC and other importers at a disadvantage.
Ironically, this price war has emerged just as Nigeria’s downstream sector was fully deregulated. When Dangote began producing petrol a year ago, the end of subsidies eliminated price distortions and long queues at NNPC stations. Now, those same stations are once again grappling with dwindling patronage—not due to scarcity or subsidy removal, but because a domestic refinery has fundamentally altered the economics of fuel supply.
The financial implications are staggering. Industry estimates suggest that petrol importers could lose as much as N102.48 billion monthly due to Dangote’s price cuts. At the same time, the Dangote refinery itself is projected to lose about N91 billion per month as it absorbs the cost of aggressive pricing aimed at securing market dominance.
Independent Petroleum Marketers Association of Nigeria (IPMAN) spokesperson, Chinedu Ukadike, confirmed that marketers are bleeding financially. “Marketers will lose over N80 billion on this reduction,” he said. “But the reality is that consumers will always move to where fuel is cheaper. That is the law of the market.”
Ukadike explained that Nigeria’s downstream sector has entered a new era where demand and supply, not regulation or sentiment, dictate outcomes. “Nobody is regulating you now; the market regulates itself,” he said. “If you refuse to drop your price, you lose customers. It’s that simple.”
In response to the losses, IPMAN has urged the Dangote refinery to consider compensatory measures for marketers who purchased petrol at older, higher prices. Suggestions include discounts on future purchases or other forms of relief to cushion the financial blow.
Dangote, however, has been unequivocal in his stance. Speaking during a recent media briefing, Africa’s richest man insisted that the refinery is also absorbing enormous losses. He disclosed that Dangote Refinery lost about N60 billion in November alone following a previous gantry price reduction of N49 per litre.
“For the marketers, I pray and I wish they would even lose more because I’m not printing money,” Dangote said bluntly. “I’m also losing money. This is not about profit; it’s about survival.”
He accused some marketers of attempting to sabotage the domestic refining effort by insisting on continued petrol imports. “They want imports to continue,” he said. “But $20 billion of investment is too big to fail. We will fight as much as we can to crash the prices.”
Dangote vowed that for December and January, petrol should not sell above N740 per litre nationwide. He also issued a direct challenge to marketers, inviting anyone capable of buying as little as 10 trucks to purchase petrol directly from the refinery at N699 per litre.
The refinery’s strategy appears to be working. Over the weekend, Dangote confirmed that more than 1,000 fuel trucks now load petrol daily from its gantry, a dramatic increase attributed to reduced prices and lowered entry barriers. The minimum purchase requirement was slashed from two million litres to 250,000 litres, opening the market to smaller independent marketers.
To further reassure buyers, the refinery introduced a 10-day bank guarantee system, ensuring uninterrupted supply and easing financing pressures. According to Dangote Group, these measures are designed to stabilise supply, foster inclusivity, and strengthen Nigeria’s energy security.
“Our goal has always been to make energy affordable and accessible for every Nigerian,” Dangote said. “By lowering prices and reducing minimum purchase volumes, we are empowering both large and small marketers to participate in the market.”
IPMAN has welcomed the shift, describing it as a long-overdue recognition of the role independent marketers play in fuel distribution. Ukadike revealed that IPMAN members now load petrol directly from the refinery, noting that independent marketers account for over 85 percent of filling stations nationwide.
“This is the first time Dangote invited IPMAN directly,” Ukadike said. “The major marketers failed him. He has now realised that independent marketers are the strategic partners who can move his products quickly.”
Meanwhile, the Dangote Group has taken its message directly to consumers. In short videos shared across social media, the company warned Nigerians against being overcharged, emphasizing that petrol now sells at N739 per litre at MRS stations nationwide.
“Say no to rip-offs,” the message urged. “Many other stations are joining soon.”
As the price war intensifies, one thing is clear: Nigeria’s downstream oil sector is being reshaped in real time. The emergence of a powerful domestic refinery has ended the era of unchecked pricing and exposed inefficiencies long masked by imports and subsidies. While the financial pain is severe for marketers and importers, consumers are already reaping the benefits.
Whether the current pricing regime is sustainable remains uncertain. But what is no longer in doubt is that competition has arrived in Nigeria’s fuel market—and it has arrived with force.
