Nigeria’s fuel market reels from a brutal price swing. The Dangote Petroleum Refinery has slammed the brakes on a brief relief, jacking up petrol prices just days after cutting them.
The Price Whiplash
The refinery raised its ex-depot price to N1,175 per litre on Friday, reversing a N100 reduction it announced on March 10 . Depot operators across the country scrambled to suspend sales. Loading operations halted temporarily as the facility reconciled stock levels with the new pricing reality.
Market sources confirmed the disruption hit multiple petroleum depots simultaneously. “Depot owners across multiple hubs have temporarily halted transactions following the refinery’s upward review,” one insider disclosed .
Why Prices Spiked
The culprit lies 7,000 kilometers away. Global crude oil prices have exploded following escalating military tensions between the United States, Israel, and Iran.
Brent crude surged from $91 to $100 per barrel within days . At its peak this week, Nigerian Bonny Light crude touched $120 per barrel before settling around $100 . This volatility forced Dangote’s hand.
“The revision reflects the surge in global crude oil prices. Brent crude moved from around $91 per barrel to about $100 per barrel, and that increase feeds directly into the cost of refining,” a refinery source explained .
The Hormuz Factor
The crisis centers on the Strait of Hormuz, the world’s most critical oil chokepoint. Roughly 20 percent of global oil shipments pass through this narrow waterway daily .
Iran’s new Supreme Leader, Mojtaba Khamenei, has vowed to keep the strait closed as “a tool of pressure” against the US and Israel . Tanker traffic has collapsed from 138 vessels daily to fewer than five .
The International Energy Agency calls this the largest supply disruption in history, with global output falling by 8 million barrels daily . In response, the agency ordered a record 400 million barrel release from emergency reserves, yet prices remain stubbornly high .
What This Means for Nigerians
The immediate fallout hits depot operators and, ultimately, consumers. The refinery’s coastal supply price jumped from N1,378,548 to N1,512,648 per metric tonne, a 9.7 percent increase .
With the Federal Government suspending petrol import licenses to prioritize domestic refining, Dangote’s pricing decisions carry enormous weight . The refinery now controls the bulk of Nigeria’s N14.4 trillion petrol market.
Energy experts warn that sustained crude prices above $100 could trigger further retail pump price adjustments nationwide . For a country already battling inflation, this presents a fresh economic challenge.
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