Major oil marketers in Nigeria are set to begin purchasing Premium Motor Spirit (PMS), also known as petrol, directly from the Dangote Petroleum Refinery. This shift comes as the Nigerian National Petroleum Company Limited (NNPCL) ends its role as the sole off-taker of petrol from the $20 billion refinery.
Sources from both NNPCL and the Major Energies Marketers Association of Nigeria (MEMAN) confirmed the development. This change opens the door for downstream sector players to directly buy fuel from Dangote, a move that signifies the complete removal of petrol subsidies by the Federal Government.
Unverified reports have emerged that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has released new petrol prices, which could be higher than current pump prices. However, George Ene-Ita, spokesperson for NMDPRA, did not confirm the release of these prices when contacted.
Oil marketers have expressed that with NNPCL no longer being the exclusive buyer, the removal of petrol subsidies is now official. Earlier reports suggested that the government might spend around ₦236 billion monthly to subsidize petrol from NNPCL and the Dangote refinery. However, this new move could save NNPCL substantial funds.
As of Tuesday, oil marketers had yet to start purchasing directly from the Dangote refinery. However, sources indicated that the directive to shift purchases from NNPCL to Dangote was formally issued. It is expected that marketers will begin loading from the plant next week. No new petrol prices have been set yet, and marketers are still selling at existing rates.
This development will allow marketers to bypass NNPCL and deal directly with the Dangote refinery, aligning prices with market forces. It is anticipated that petrol prices will increase in the coming days as the market adjusts to the new dynamics of the downstream oil sector.
