Dangote Petroleum Refinery and Petrochemicals has reassured Nigerians that it will continue to act as a stabilising force in the face of recent disruptions in the global oil market triggered by tensions between the United States and Iran.
The refinery noted that the crisis in the Middle East has forced several refineries worldwide to shut down or scale back operations, leading to reduced production and growing scarcity of petroleum products. The situation has been further compounded by China’s decision to halt exports of gasoline and diesel.
In a statement released on Thursday, Dangote Petroleum Refinery and Petrochemicals said it plans to shield Nigeria from the effects of these global supply disruptions by prioritising fuel supply to the domestic market, highlighting this as a key advantage of local refining.
According to the company, the conflict has pushed crude oil and freight prices significantly higher. Benchmark Brent Crude prices have climbed by about 26 percent in a short period, rising above $84 per barrel.
As a result, the refinery said it had increased the ex-depot price of Premium Motor Spirit by ₦100 per litre, representing roughly a 12 percent adjustment. However, it added that it has absorbed about 20 percent of the rising costs to ease the burden on the local market, even though crude oil continues to be purchased at prevailing global prices.
The company explained that Nigerian crude is currently priced $3 to $6 above the Brent benchmark. With additional freight charges of about $3.50 per barrel, crude delivered to the refinery costs between $88 and $91 per barrel, compared with about $68 per barrel when the ex-depot price previously stood at ₦774 per litre.
It also disclosed that it receives around five crude cargoes monthly from Nigerian National Petroleum Company Limited, which are paid for in naira. However, these shipments are priced at international market rates plus a premium and fall short of the 13 cargoes needed each month to meet local demand. This shortfall forces the refinery to purchase foreign exchange at open market rates to pay for additional crude sourced from both local and international traders.
The refinery further blamed the high cost of crude on the failure of Nigeria’s upstream producers to supply sufficient volumes as required under the Petroleum Industry Act, compelling it to rely heavily on international traders who charge extra premiums.
Despite the challenges, the company said it has continued to align its pricing with prevailing market conditions to ensure sustainable operations, noting that selling fuel below cost would threaten its ability to procure crude and maintain uninterrupted production.
It stressed that large-scale local refining helps limit Nigeria’s exposure to global supply disruptions, reduce pressure on foreign exchange, and prevent severe fuel shortages during periods of international instability.
The refinery also revealed plans to introduce Compressed Natural Gas-powered trucks to improve fuel distribution nationwide. The rollout, scheduled to begin this month, is expected to lower logistics costs, boost efficiency, and speed up deliveries across the downstream sector.
According to the company, it remains focused on transparency, operational efficiency, and achieving long-term energy security and stability for Nigeria while keeping fuel prices as affordable as possible.
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