The fuel supply agreement between the Dangote Petroleum Refinery and major petroleum marketers has collapsed, leading to a sharp rise in petrol imports into Nigeria.

The deal, reached in October 2025, involved 20 large marketers who were expected to lift a combined 600 million litres of petrol from the Dangote refinery every month. The arrangement was introduced as a pilot scheme aimed at improving fuel availability, cutting distribution bottlenecks and easing pressure on pump prices.

However, the agreement fell apart after disagreements over pricing. Industry sources say marketers became unhappy when international petrol prices dropped, making imported fuel cheaper than petrol supplied by the refinery. They argued that Dangote’s gantry price was not adjusted quickly enough to reflect the decline in global benchmarks.

Data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority show that petrol imports surged in November 2025, rising to about 1.56 billion litres, the same period when the pricing dispute intensified.

Under the initial agreement, petrol was sold at about ₦806 per litre for coastal deliveries and ₦828 per litre at the gantry, with plans for monthly price reviews. Independent marketers were restricted to small purchase volumes and had to buy through the selected marketers, a system that was meant to reduce middlemen.

Sources said the arrangement worked briefly but began to unravel when marketers noticed that imported petrol was landing at lower prices than Dangote’s supply. Faced with potential losses, many marketers turned back to imports.

Although the refinery later reduced its gantry price to about ₦699 per litre, the cut came after several marketers had already imported fuel or bought locally at higher prices, leaving them exposed to losses.
The Independent Petroleum Marketers Association of Nigeria confirmed that the agreement is no longer in place.

According to the association, the refinery has now opened sales to all marketers, allowing even smaller buyers to purchase petrol directly.
Recent market data indicate that the spot price of imported petrol is now slightly below Dangote’s current gantry price, keeping imports attractive to marketers.

For now, the collapse of the deal means Nigeria’s downstream market has returned to open competition, with both local supply and imports influencing fuel availability and pricing