Dangote Refinery has reversed its recent fuel price hike, slashing the ex-gantry price of Premium Motor Spirit by N75 to N1,200 per litre, bringing relief to Nigerians who had braced for even higher costs at the pump. The refinery had raised the price to around N1,275 per litre just days ago, citing pressure from volatile global oil markets as the US-Israeli war with Iran sent crude prices soaring above $110 per barrel. The swift downward review is directly linked to a sharp drop in international crude prices following President Donald Trump’s announcement of a conditional two-week ceasefire with Iran. Brent crude has plunged to $95.05 per barrel, a 13 per cent decline, while West Texas Intermediate closed at $97.18, recording nearly a 14 per cent drop.
Industry analysts point to Trump’s ceasefire announcement as the key trigger for the price crash, as the temporary truce has eased fears of immediate supply disruptions through the Strait of Hormuz, through which approximately 20 per cent of the world’s oil normally passes. The two-week pause in hostilities, agreed after intense mediation by Pakistan and China, has allowed global energy markets to breathe a sigh of relief after nearly 40 days of war that threatened to spiral into a wider regional conflagration. With the strait now open for at least two weeks under Iranian military coordination, tanker traffic has begun to resume, easing the supply crunch that had driven prices to their highest levels since 2008. Dangote’s decision to pass the savings to consumers reflects the refinery’s sensitivity to global price movements, given its reliance on both domestic and imported crude.
The price reversal will be welcomed by millions of Nigerians already reeling from record-high inflation, currency devaluation, and the removal of fuel subsidies. However, the relief may be temporary. The ceasefire is conditional on Iran agreeing to the “complete, immediate and safe opening” of the strait, and Trump has warned that if negotiations fail, military strikes could resume within two weeks. The ghost fleet of 26 tankers carrying Iranian crude to Chinese teapot refineries continues to operate, and the underlying geopolitical tensions that triggered the war remain unresolved. For now, however, Nigerians can fill their tanks at slightly lower prices, and the Dangote Refinery has demonstrated an ability to respond quickly to changing market conditions.
The reduction also raises questions about the refinery’s pricing strategy and its relationship with the Nigerian National Petroleum Company Limited, which remains the sole off-taker of Dangote’s petrol. The NNPC has yet to announce whether it will adjust pump prices at its retail outlets to reflect the lower ex-gantry rate. Industry observers note that the gap between Dangote’s ex-gantry price and the retail pump price has been a source of friction, with marketers complaining of thin margins. If the NNPC passes the full N75 reduction to consumers, petrol could retail at around N1,000 per litre in some parts of the country, though prices vary widely depending on location and transportation costs. For now, the message from Dangote is clear: when global oil prices fall, Nigerians will benefit.
