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Dangote refinery: Marketers speak on imminent fuel price reduction

 

Following the commencement of operations at the Dangote
Refinery, oil marketers have reacted to an imminent price reduction of fuel
products.

 

The Dangote refinery announced the commencement of
production last Friday.

 

The company said it awaits the Federal Government’s approval
to supply diesel and JetA1 or aviation fuel across the domestic market.

 

Reacting to the development, President of Petroleum Products
Retail Outlets Owners Association, PETROAN, Billy Gillis-Harry, said the coming
onstream of the Dangote refinery means the cost of refined products would be
impacted positively.

 

“However, the fact that the crude oil being used is the one
for domestic consumption takes away the cost of freight and insurance from the
total cost. So, if that has been removed, there is a likelihood that prices
will be impacted positively to the benefit of Nigerians.

 

“But what exactly will be the price is to be awaited and
worked out because, for instance, we don’t know how much he received the crude
oil, whether it is in naira or dollar, and that is business information that
sometimes is difficult to release.”

 

“Regardless of the situation, we should still expect a
reprieve; some advantages should come to us. So that is my thinking”.

 

Also, the President of the Independent Petroleum Marketers
Association of Nigeria, IPMAN, Abubakar Maigandi, hinted that as soon as its
members commence loading the Dangote refinery’s petroleum products, the price
will be determined.

 

“It is when we start loading that he can give us the price,
and then we will know how much to sell”, Maigandi stated.

 

“Immediately he starts releasing products, we are assured of
the availability of products, and there will be no more scarcity, provided that
he is producing. Also, it will create employment opportunities.”

 

Meanwhile, Executive Secretary/Chief Executive Officer,
Major Oil Marketers Association of Nigeria, MOMAN, Clement Isong, said, “I’ve
heard some people say there will be savings in freight; that might be true. But
that is a tiny part of the cost. The major part of the cost is the raw
material, which is the crude oil; even the refining cost is quite small. I
don’t expect a significant price drop, definitely not N400; that’s very
unlikely, in my opinion.”

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