Oil Marketers Complain to Tinubu: Diesel Price Too Low

Marketers Urge Tinubu to Act on Diesel Price

“We have been exporting aviation fuel, we have been producing kerosene, we have been producing diesel, but yesterday..."

Dangote Refinery ramps up operations, exporting naphtha, LSSR fuel oil, and diesel, while commencing domestic sales of diesel and jet fuel, marking significant milestones in its journey to meet Nigeria's fuel demands.

Vice President of Dangote Industries Limited, Devakumar Edwin, revealed that petroleum product marketers in Nigeria have written to President Bola Tinubu, complaining that the recent price drop of diesel to N900 per litre at Dangote Refinery is negatively affecting their business operations.

“Petroleum product marketers in Nigeria have written to President Bola Tinubu to complain that the refinery local prices which have dropped from N1,200 to N1,000 and now N900 per litre are impacting their businesses negatively,” Edwin said.

Devakumar Edwin, Vice President of Dangote Industries Limited, highlighted the challenges facing Dangote Refinery, which impact Nigeria's fuel supply and pricing. He mentioned that the refinery, located in the Lekki Free Zone near Lagos, struggles to sell around 29 tankers of diesel daily due to low demand from local petroleum product importers.

The limited demand from local importers hinders the refinery's ability to sell its diesel production, affecting its overall operations and contributing to the challenges in Nigeria's fuel supply and pricing.

“As a result of this poor local patronage, the refinery exports most of its diesel and aviation fuel,” he said.

Devakumar Edwin hinted that Dangote Refinery may explore export options for its products if NNPCL and other Nigerian petroleum dealers fail to patronize the refinery, essentially forcing the company to seek alternative.

“We have been exporting aviation fuel, we have been producing kerosene, we have been producing diesel, but yesterday, we started the production of PMS. So, that was the last stage. The only thing now left out is petrochemicals.

“So, the good news for the country is we have started producing PMS from our refinery,” he had said.

Speaking on if the petrol would be sold locally, Edwin said, “Well, I explained how there has been a kind of a blockade from lifting our products within the country. The traders have been trying to block (it), and so now we have been exporting our petroleum products. PMS, we are ready to pump in as much as possible to the country.

“But if the traders or NNPCL are not buying the product, obviously, we will end up exporting the PMS (petrol) as we are doing with the aviation jet and diesel,” he declared.

Devakumar Edwin expressed surprise at the unforeseen obstacles that emerged just as Dangote Refinery was poised to commence operations. He nostalgically recalled the initial objective of valorizing Nigeria's raw materials, lamenting that, despite over three decades of efforts, the country still exports crude oil while relying on imports for refined petroleum products, a situation he finds regrettable.

"The philosophy is to take the crude, and instead of exporting the crude, refine it, add value; export the finished products, and supply the finished products locally. But unfortunately for us, we started facing challenges with the crude supply.

“What is happening today? We are struggling to get the crude. We are now importing the crude from the US, we are importing from Brazil, and from other parts of the world. So, the whole philosophy has gone upside down. After all these decades, we are exporting crude, importing products,” he added.

“The same thing is continuing. We are not getting enough crude allocation, and the crude is still being exported. We are forced to import crude from outside. Yes, we are getting some crude locally, but it's not adequate.”

The Dangote Refinery, with a daily capacity of 650,000 barrels, achieved several milestones in its export and domestic sales operations. It began exporting naphtha in March and LSSR fuel oil in May, while commencing domestic sales of diesel and jet fuel in April. Additionally, the refinery started exporting European-specification diesel in June, marking significant progress in its operations.