Dangote Refinery: How FX Intervention Can Slash Petrol Prices Below N600 Per Liter — Refinery Operators
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The Crude Oil Refiners Association of Nigeria (CORAN) has called on the Nigerian government to peg foreign exchange at N1000 per dollar to reduce Dangote Refinery’s petrol price to below N600 per liter.
This suggestion comes amid the current petrol price hike in Nigeria, with prices ranging from N950 to N1,100 per liter.
According to Eche Idoko, CORAN’s spokesperson, “For instance, you can say, you are using N1,000 as an exchange rate for this dollar deal, for the locally refined petroleum products. And like that, you will see a significant drop in the price.” Idoko emphasized that the current pricing reflects the lack of government intervention, considering the naira’s value and crude oil prices in the international market.
Idoko suggested that government intervention through FX pegging would lead to improved prices. “This is different from paying money as a subsidy. You are only just putting mechanisms in place to ensure the product is cheap,” he clarified.
The Nigerian National Petroleum Company Limited recently announced a petrol price hike, citing the cost of Dangote fuel, which is sold at N898 per liter. However, Dangote Refinery attributed the pricing to international crude oil costs.
This development comes as the Dangote Refinery is set to begin local petrol production, potentially reshaping Nigeria’s fuel pricing structure.
The refinery has a capacity of 5.38 billion liters of tankage capacity, enough to crash current pump prices of Premium Motor Spirit.
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