News
Dangote Refinery Tweaks Diesel Prices To Mirror Currency Swings
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Dangote Petroleum Refinery has raised diesel prices from ₦940 to ₦1,100 per litre due to the Nigerian naira’s depreciation.
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The price adjustment reflects the refinery’s responsive pricing strategy in line with market dynamics and follows earlier reductions.
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The increase is attributed to the adverse effects of the naira’s instability against the US dollar, as stated by IPMAN officials.
EKO HOT BLOG reports that the Dangote Petroleum Refinery has raised diesel prices from ₦940 to ₦1,100 per litre due to the Nigerian naira’s ongoing decline against the US dollar.
This adjustment follows earlier reductions and aligns with market conditions, reflecting the refinery’s pricing strategy.
According to Punch Newspaper, the recent price hike is directly linked to the naira’s instability against the dollar, as stated by Abubakar Maigandi, National President of IPMAN.
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Chief Ukadike Chinedu, National Public Relations Officer of IPMAN, highlighted the refinery’s internal struggles amidst currency depreciation, shedding light on the underlying challenges.
“The refinery imports a significant portion of its crude oil, which is priced in dollars; hence, the fluctuations in exchange rates directly impact the cost of refined products,” Ukadike said.
During April, the naira had shown signs of improvement, which positively influenced commodity prices briefly.
However, this improvement was short-lived, as the naira plummeted to over ₦1,400/$ in May, further complicating pricing strategies for businesses reliant on imported goods.
According to a Bloomberg report, the Dangote refinery, a significant industrial project by Africa’s richest man, Aliko Dangote, has also been reportedly seeking to purchase millions of barrels of US crude to bolster its operations.
This move indicates the refinery’s strategic adjustments in response to operational demands and market conditions.
In addition to the diesel price update, the refinery has announced its plans to commence the domestic distribution of Premium Motor Spirit (PMS), commonly known as petrol, starting next month.
Diesel Prices
This development is seen as a potential game-changer in reducing Nigeria’s dependency on imported petrol.
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Oil marketers have reacted positively to the announcement, expressing hope that the refinery’s entry into the petrol market could lead to more competitive pricing.
“We anticipate that the price of petrol from Dangote will be lower than the current rates offered by NNPC, ideally around ₦500 per litre,” Maigandi remarked, highlighting the sector’s expectations for relief in fuel costs.
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