Local Marketers Boycott Dangote Refinery Products, Causing The Average Fuel Price To Reach N1,406.05/Litre
In August 2024, the average monthly cost of diesel in Nigeria increased by 1.93% to N1,406.05 per litre.
The most recent data from the National Bureau of Statistics (NBS) support this.
The month-over-month increase coincides with a deepening impasse between Dangote Refinery and local marketers, as many refuse to buy the refinery’s cheaper diesel products.
Diesel prices RisE from July’s Slump
In June 2024, consumers paid an average of N1,462.98 for Automotive Gas Oil (Diesel), a 5.71% reduction from N1,379.48 in July 2024.
Diesel prices significantly increased in August 2024 compared to July 2024, most likely due to a boycott started by regional fuel merchants.
Nigeria saw a notable 64.58% annual increase from N854.32 per litre in August 2023.
According to the NBS study, the northern area had the highest average pricing, with Kaduna leading the way at N1,930.79 per litre and Bauchi following closely after at N1,927.34. At N1,237.14 and N1,255.00, respectively, southern states like Lagos and Ogun had the lowest average prices.
The report said as follows: “The average retail price of Automotive Gas Oil (Diesel) paid by consumers increased by 64.58% on a year-on-year basis from a lower cost of N854.32 per litre recorded in the corresponding month of last year (i.e., August 2023) to a higher cost of N1,406.05 Per litre in August 2024.”
“On a month-on-month basis, an increase of 1.93% was recorded from N1,379.48 in July 2024 to an average of N1,406.05 in August 2024.”
“Looking at the variations in the State prices, the top three States with the highest average price of the product in August 2024 include Kaduna State (N1,930.79), Bauchi State (N1,927.34), and Taraba (N1,638.14).”
“In addition, the three states with the lowest prices were Lagos State (N1,237.14), Ogun State (N1,255.00), and Osun (N1,268.18).”
What To Note
The Dangote Refinery started producing diesel and aviation jet fuel in April and premium motor spirit (PMS) in September after it opened for business in March.
The richest man in Africa, Aliko Dangote, declared that the local diesel market’s price had dropped by about 60% due to his Dangote Refinery’s supply of fuel.
The business tycoon claimed that diesel was sold for about N1,700 before the Dangote Refinery started operations. Nonetheless, the refinery dropped the price by almost 60% to around N1,000.
He added that they have kept the diesel price below N1,200 even though the exchange rate has increased to almost N1,500 per dollar.
However, Vice President of Dangote Industries Limited Devakumar V.G. Edwin recently expressed anger over local marketers’ boycott of Dangote Refinery’s products during an X (previously Twitter) event.
He disclosed that some Nigerian traders have declined to purchase from the refinery, opting to continue importing refined products from overseas despite the facility’s best attempts to provide reasonably priced petroleum products.
Even though the refinery can produce a lot, local marketers only buy around 3 percent of the product.
He mentioned that because local traders are refusing to purchase at the refinery’s reduced pricing, 97% of the refinery’s output, which includes diesel and jet fuel, is exported.
