The Independent Petroleum Marketers Association of Nigeria (IPMAN) has expressed its expectations concerning the pricing of Dangote Refinery’s new petrol products. The National Public Relations Officer of IPMAN, Chinedu Ukadike, spoke on behalf of the association, clarifying that their comments about marketers possibly avoiding Dangote Refinery’s products were not meant as a threat but rather as a polite request. Ukadike emphasized that the association expects Dangote Refinery to offer competitive pricing on its petrol products, particularly because it is an indigenous refinery and should align with the affordability that the Nigerian National Petroleum Company Limited (NNPCL) currently provides.
In an interview conducted on Arise TV on Tuesday, Ukadike pointed out that the NNPCL manages to keep petrol prices relatively low by selling to marketers at reduced rates. He argued that Dangote Refinery, being a local refinery, should follow a similar pricing model and not charge marketers higher than NNPCL does. According to him, this expectation is not a demand but a logical request, considering that the refinery is part of Nigeria’s oil and gas sector, where maintaining affordability is key to sustaining a stable market and curbing undue price hikes.
Ukadike stated, “Well, it is not a threat. We are yearning; it is not a threat. We are yearning that whatever NNPC is giving to us, we also believe that since Dangote is an indigenous refinery, they should also align with NNPC and give us the same price.” He further explained that having a price disparity between NNPCL and Dangote could create unnecessary confusion and market volatility, especially with long queues forming at filling stations. In terms of business ethics, it is better for Dangote to consider the overall market landscape and align its prices to be competitive. Although Dangote has the autonomy to set its prices, Ukadike stressed that independent marketers are looking for cost-effective petrol sources, making pricing a crucial factor in their purchasing decisions.
Ukadike went on to discuss the importance of having more refineries, like the Port Harcourt refinery, operational so that independent marketers have multiple options to source their products. He noted that the availability of different sources could enhance competition in the petroleum industry, thereby driving prices down. He also explained that the price differences observed at independent marketers' filling stations often depend on where they source their products. For instance, NNPCL sells at ₦895 per liter for products sourced from Port Harcourt, but prices differ across other terminals such as Lagos and Warri.
“NNPCL is selling at ₦895, that’s from Port Harcourt. The prices differ from the terminal, that is the depot you are picking the product from. If you are picking from Lagos, it’s far cheaper, and if you are picking from Warri, there’s also a different price range. For those picking from Port Harcourt, it’s ₦895; so it depends on where you are picking the products,” Ukadike clarified. He also pointed out that marketers adjust their prices based on several factors, including transportation costs, managerial expenses, and haulage fees, ensuring that their final prices reflect their overall operational costs.
Ukadike further praised the benefits of the current deregulation process in Nigeria’s oil sector, which allows marketers to set their prices according to their source of purchase and the associated costs of bringing the product to their destinations. He emphasized that deregulation fosters healthy competition, with prices being determined by market forces of demand and supply.
He concluded by stating that IPMAN’s key priority is to see the product priced as cheaply as possible while promoting competition in the sector. “Our most important and pertinent desire is that we want this product as cheap as possible, and we also want competition to set in. Once competition is set in, the forces of demand and supply will determine price,” Ukadike noted. He believes that a competitive environment, fueled by multiple refineries and supply chains, would benefit both the petroleum marketers and consumers, ultimately leading to better pricing for petrol across the country.
