Why Nigerians Shouldn’t Rejoices Over Dangote’s Petrol Price Reduction – Expert

Petrol consumers in Nigeria have been cautioned against celebrating Dangote Refinery’s recent petrol price cut, despite the immediate relief it offers. Professor Emeritus of Petroleum Economics, Wumi Iledare, explained that while the reduction of N129 per liter to N699 at the gantry may seem beneficial, it could have negative long-term consequences for the country’s downstream oil sector.

Iledare warned that the move highlights deeper structural issues, as the sector risks becoming dominated by a single supplier. He described the growing concentration in the market as edging toward an oligopoly, stressing that without strong regulatory oversight, such dominance could undermine fair competition and harm long-term affordability.

“The price cut is positive, but without strong oversight, it risks reinforcing the very dominance that undermines long-term affordability,” Iledare said, urging regulators to closely monitor allocation practices, enforce transparency, and protect smaller players whose presence ensures balance in the sector. He emphasized that the reduction should not be used as a strategy to weaken independent marketers or consolidate market power.

While the Dangote Refinery’s gantry price fell by 15 percent, retail prices in Abuja have remained significantly higher, ranging between N910 and N937 per liter. The development has prompted discussions across the energy sector and among Nigerians, highlighting the need for vigilance and strict regulation to maintain market stability.