Dangote Reveals Real Reason for Recent Reduction in Fuel Price

Aliko Dangote, President of Dangote Industries Limited, has clarified that the recent reduction in fuel prices was a result of market forces, not a corporate strategy aimed at undercutting competitors. During an interview on Arise TV, Dangote explained that the price cut, which saw the ex-depot price of petrol at his refinery drop from N970 to N899.50 per litre on December 19, 2024, was driven by the need to respond to market dynamics.

“The price reduction is a response to the market,” Dangote stated. “We’ve invested over $20 billion in this refinery, and it’s important to protect our interests and investments.”

The reduction in Dangote Refinery’s prices sparked competition in the downstream sector, with the Nigerian National Petroleum Company Limited (NNPCL) also lowering its price to N899 per litre. Additionally, Dangote announced a partnership with MRS Oil to sell petrol at N935 per litre across retail outlets nationwide, much to the benefit of Nigerian consumers.

Dangote reiterated that the refinery’s goal is to transform Nigeria’s oil sector and economy. He emphasized that petroleum imports have a significant impact on the country’s foreign exchange reserves. “Forty percent of our foreign exchange demand comes from the importation of petroleum products. The more we rely on imports, the more we deplete our foreign reserves,” he said.

The business magnate also expressed his commitment to the project despite ongoing criticism. “Criticism will not stop us. I’m doing this project out of love for my country and to create a legacy,” Dangote asserted. “In the history of Nigeria, no one has invested $20 billion into a single project. If I had invested in companies like Google or Apple, my returns would be higher, and I wouldn’t face the same challenges.”

Dangote further addressed the $1 billion investment by NNPCL in the refinery, calling it “a drop in the ocean” compared to the total cost of the $20 billion project. He also recounted how negotiations with NNPCL regarding financial support had broken down. “It’s misleading to claim that NNPCL provided $1 billion to help with liquidity issues. That’s simply not true,” he added.

Devakumar Edwin, Vice President of Dangote Industries Ltd., revealed that the refinery is currently operating at 350,000 barrels of crude per day, with plans to reach full capacity of 650,000 barrels per day once operations are fully ramped up. “The refinery will play a crucial role in reducing Nigeria’s dependency on oil imports,” Edwin said.