A senior executive at the Dangote Petroleum Refinery has revealed that the company has been selling petrol and diesel at prices below prevailing market levels in Nigeria, effectively absorbing part of the cost pressure caused by the recent spike in global crude oil prices.
The official, who spoke anonymously, said the refinery’s current ex-depot price of ₦1,200 per litre for petrol does not fully reflect the sharp increase in crude prices that followed supply disruptions around the Strait of Hormuz.
Brent crude, the global oil benchmark, reportedly rose from about $66 per barrel in late February to above $100 per barrel after tensions in the Middle East affected oil shipments. This surge has pushed up the cost of refined petroleum products worldwide.
Despite these pressures, the source explained that the refinery has tried to “optimise” the prices of Premium Motor Spirit and Automotive Gas Oil to reduce the burden on consumers. The official confirmed that this optimisation effectively amounts to subsidising the products, as the refinery is not transferring the full cost impact to buyers.
However, the same pricing approach is not being applied to aviation fuel. According to the source, Jet A-1 is being sold strictly at market-driven rates because it is not financially sustainable to subsidise all fuel categories.
Industry data indicate that the refinery sells aviation fuel to marketers at under ₦2,000 per litre, with a reported price of about ₦1,799 per litre as of Monday. This is slightly lower than the average cost of imported jet fuel.
The development comes amid mounting concerns from the Airline Operators of Nigeria, which has warned that rising jet fuel prices could force airlines to suspend operations.
Airline representatives say Jet A-1, which sold for around ₦900 per litre in February, has climbed to between ₦2,700 and ₦3,500 per litre in some retail transactions.
In a complaint to the Major Energies Marketers Association of Nigeria, the airline body described the increase as excessive and not fully aligned with global crude price movements, urging marketers to review their pricing.
Marketers responded that although prices have risen due to international supply disruptions, the figures cited by airlines are significantly above their internal market survey averages. They advised operators facing such prices to consider alternative suppliers offering more competitive rates.
The Dangote official maintained that while the refinery is making efforts to cushion the impact of rising crude prices on petrol and diesel, extending the same support to aviation fuel is not feasible under current market conditions.
