Experts believe that prices of petrol and diesel may not crash significantly despite the commencement of production at the Dangote Petroleum Refinery.
With the removal of subsidy on petrol in May 2023, the price per litre of petrol jumped from around N184 to over N600 depending on the location. Diesel also sells for about N1500 per litre at retail outlets.
They said though the behemoth refinery is located in Lagos, Nigeria, the input cost for the operationalisation of the $20bn facility is import-dependent, adding that the volatility of the foreign exchange rates might make it difficult for any marginal reduction in the prices of the premium commodities.
These were the thoughts of the Publisher of Sweet Crude Reports, Hector Igbikiowubo; and Nairametrics Founder, Ugodre Obi-Chukwu; on Inside Sources with Laolu Akande, a socio-political programme aired on Channels Television on Friday.
Both Igbikiowubo and Obi-Chukwu commended Africa’s richest man, Aliko Dangote, for defying all odds to ensure that his dream to build a functional refinery came to life.
They said Dangote demonstrated that the Federal Government has no excuse not to get the country’s four dormant refineries working and urged the Nigerian National Petroleum Company (NNPC) Limited to increase crude supply to the private refinery.
The billionaire business tycoon recently said his refinery would continue to import 24 million barrels of West Texas Intermediate crude due to insufficient local crude production and supply by the state-run NNPC.
The experts said though the private refinery won’t solve Nigeria’s energy security needs, its operations would go a long way in making premium petrol products available in the country.
“The Dangote Refinery cannot solve the problem because the Dangote Refinery will continue to pay for crude oil in USD (United States Dollar),” Igbikiowubo said.
