Oil marketers may start importing Premium Motor Spirit (petrol) due to the Nigerian National Petroleum Company Limited’s (NNPC) declaration that it will only fully offtake the product from the Dangote Petroleum Refinery if market prices are higher than pump prices in Nigeria. NNPC stated that Dangote and other domestic refineries can sell directly to marketers on a willing buyer, willing seller basis, and it has no intention of becoming a distributor in a free market environment.
This contradicts Alhaji Aliko Dangote’s statement that the refinery would wait for NNPC to be the sole off-taker of its petrol domestically. Oil marketers have reacted by saying they will source the product from wherever it is cheaper, including importation.
Mustapha Zarma, National Operations Controller, Independent Petroleum Marketers Association of Nigeria (IPMAN), stated, “We may contact the refinery’s sales department this week to find out the price… If the price is competitive enough… then we wouldn’t mind purchasing directly from him.”
Zarma noted that since the government and NNPC said the Dangote refinery would sell its product at market price, it implies no subsidy intervention. He added that other dealers can now source the product from any producer at a cheaper price, locally or internationally.
Industry observers believe the Federal Government is not ready to stop fuel importation, but is systematically stopping subsidies on petrol, following NNPC’s revelation that it spent over N7.8tn subsidizing petrol.
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