Dangote Petroleum Refinery, valued at $20 billion, has initiated the sale of Automotive Gas Oil (diesel) to oil marketers nationwide, starting last week. This move, confirmed by both dealers and refinery officials, is poised to impact diesel prices significantly. According to Alhaji Abubakar Maigandi, the National President of the Independent Petroleum Marketers Association of Nigeria, this strategic step by Dangote is anticipated to lead to a considerable reduction in diesel prices, which had soared to approximately N1,700 per litre recently.
Despite facing regulatory hurdles, Dangote Refinery has commenced diesel production, with plans to soon introduce Premium Motor Spirit (petrol) to the market. This announcement comes after weeks of regulatory approvals delay, as reported earlier by The PUNCH.
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Acknowledging the significance of this milestone, Aliko Dangote expressed gratitude to President Bola Tinubu and various regulatory bodies for their support. He emphasized the refinery’s commitment to producing diesel and aviation fuel, with production already underway. The refinery, boasting Africa’s largest capacity of 650,000 barrels per day, is poised to transform Nigeria from a fuel importer to a net exporter, potentially reshaping the regional fuel market dynamics.
As the refinery gears up to sell diesel in minimum quantities of one million litres per marketer, industry experts, including Bismark Rewane of Financial Derivatives Company Limited, anticipate a significant drop in diesel prices by May. Rewane predicts that the pump price of diesel could plummet below N1,000 per litre, a development that would positively impact various sectors relying on diesel for their operations, such as bakers and cement manufacturers.
