A seismic shift is underway in Nigeria’s downstream oil sector as a fierce price war between the country’s largest refinery, Dangote Refinery, the Nigerian National Petroleum Company Limited (NNPC), and independent depot owners has driven fuel prices to their lowest levels in months. According to a recent report by Legit.ng, depot owners have slashed ex-depot petrol prices below Dangote’s rate of N830 per litre, with some selling as low as N826 per litre. Meanwhile, NNPC has announced a new pump price of N870 per litre at its filling stations in Lagos, marking a significant reduction from previous rates and offering much-needed relief to Nigerian consumers grappling with economic challenges.
The Price War Unfolds: A Game-Changer for Nigeria’s Fuel Market
The latest price cuts are a direct result of intensifying competition in Nigeria’s oil industry, which has historically been plagued by inefficiencies, corruption, and a heavy reliance on imported fuel despite the country’s status as Africa’s largest oil producer. Data from Petroleumprice.ng, cited by Legit.ng, reveals that multiple depots across Lagos, Warri, and Delta—including operators like AITEO, AIPEC, A.A. Rano, and NIPCO—are now offering premium motor spirit (PMS) at prices as low as N826 per litre as of June 3, 2025. This undercuts Dangote Refinery’s average ex-depot price of N830 per litre, a bold move by depot owners to capture market share in an increasingly competitive landscape.
At the higher end, some depots like Masters are still selling at N870 per litre, while others, such as Hyde and Ever, are quoting N869 per litre. Mid-range players like Sigmund and TSL are offering fuel at N868 per litre, and more affordable options include Pinnacle Warri at N856 and First Fortune at N855. Meanwhile, depots like A&E, Rainoil Lagos, Prudent Oghara, Matrix Warri, Rainoil Delta, and A.Y.M Shafa are maintaining prices at N850 per litre, still competitive but not the lowest in the market.
On the retail side, the competition is just as fierce. Dangote Refinery recently adjusted its prices for distribution partners, lowering rates from N890–N920 per litre to N875–N905 per litre, depending on the location. Partners like MRS, Ardova Plc (AP), Heyden, Optima Energy, TechnoOil, and Hyde were instructed to implement these changes immediately. However, NNPC countered with a N10 reduction at its Lagos stations, bringing the pump price down from N880 to N870 per litre. Independent retailers have followed suit—Mobil in the Ikotun area, for instance, dropped its price from N880 to N875 per litre, while Petrocam, Matrix, and other stations made similar adjustments.
The Bigger Picture: A Shift in Nigeria’s Energy Landscape
This price war marks a significant turning point for Nigeria’s energy market, which has long been marred by systemic challenges. For decades, the country’s four state-owned refineries, including the one in Port Harcourt, have been largely non-functional, forcing Nigeria to import the majority of its fuel needs despite its vast crude oil reserves. The entry of Dangote Refinery—the largest single-train refinery in the world, with a capacity of 650,000 barrels per day—has disrupted this status quo. Since commencing operations, Dangote has steadily increased its supply of locally refined petrol, challenging NNPC’s dominance and driving down prices through competition.
As early as March 2025, reports from energynews.pro noted that petrol prices had already dropped to N860 per litre (approximately 0.54 euros), a direct result of the rivalry between Dangote and NNPC. This followed several tariff adjustments by Dangote, which has been aggressively positioning itself as a key player in the market. The refinery’s ability to produce fuel locally has reduced Nigeria’s dependence on imports, a move that aligns with President Bola Ahmed Tinubu’s broader economic reforms, including the removal of fuel subsidies in May 2023.
However, the subsidy removal—while aimed at reducing fiscal strain—initially led to a sharp spike in pump prices, with the average price of gasoline in Nigeria reaching 668.3 Nigerian naira (NGN) per litre (around 0.41 U.S. dollars) by January 2024, according to Statista. This was a dramatic increase from January 2023, when the average price stood at just 257 NGN per litre. The skyrocketing costs fueled public discontent, as many Nigerians struggled to afford basic transportation and goods amid rising inflation.
The current price reductions, therefore, come as a welcome relief for consumers. “This is the first time in a long while that we’re seeing fuel prices drop like this,” said Chinedu Okonkwo, a Lagos-based taxi driver. “It’s still not cheap, but N870 per litre is better than N920. I hope this competition continues—it’s the only thing that’s helping us right now.”
A Historical Context: Nigeria’s Oil Industry and Its Challenges
To fully appreciate the significance of this price war, it’s worth examining the historical context of Nigeria’s petroleum industry. According to a detailed overview on Wikipedia, Nigeria has been a major oil producer since the discovery of petroleum in the 1950s. The oil sector has been the backbone of the country’s economy since 1960, contributing about 9% of the nation’s GDP as of February 2021. However, the benefits of this wealth have not trickled down to the majority of Nigerians, largely due to government control and corruption.
In May 1971, under General Yakubu Gowon’s administration, the Nigerian federal government nationalized the oil industry by creating the Nigerian National Oil Corporation (the precursor to NNPC). This move was partly motivated by Nigeria’s desire to join OPEC, which encouraged member states to acquire majority stakes in their oil sectors. While nationalization gave the government greater control, it also led to inefficiencies and mismanagement. Decades of government ownership meant that profits from oil production were largely captured by officials, leaving ordinary citizens impoverished and unable to benefit from the country’s natural resources.
President Tinubu, who assumed office in 2023, has sought to address these systemic issues through privatization and market liberalization. His administration’s decision to remove fuel subsidies, though controversial, was a step toward reducing government expenditure and encouraging competition in the sector. The rise of private players like Dangote Refinery aligns with this vision, as it introduces market dynamics that challenge NNPC’s monopoly and force price adjustments.
Yet, the road to reform is fraught with challenges. Many Nigerians remain skeptical of the government’s intentions, with some pointing to a long history of greed and mismanagement. In one interview cited by Wikipedia, a local who lived through the early days of oil discovery remarked, “I don’t only blame the whites that came here—what about the government? People in the government get nearly all the money from the economy.” This sentiment reflects the deep-rooted frustration that many Nigerians feel, even as the current price reductions offer a glimmer of hope.
Beyond Fuel Prices: Other Developments in Nigeria’s Oil Sector
The fuel price war isn’t the only noteworthy development in Nigeria’s oil industry. Earlier reports from Legit.ng highlighted the Nigeria Customs Service’s efforts to combat fuel smuggling, a persistent problem that has drained the country’s resources. In a recent operation, the Customs Service seized over 39,000 litres of confiscated gasoline and eight vehicles valued at more than N63 million. The fuel, intercepted by Operation Whirlwind operatives in smuggling hotspots across the Lagos-Ogun axis, was intended for illegal export to the Benin Republic. The National Coordinator of Operation Whirlwind, Assistant Comptroller General (ACG) Hussein Ejibunu, described the seizure as a “significant victory” in the fight against economic sabotage, underscoring the government’s commitment to protecting Nigeria’s resources.
As the price war continues to unfold, all eyes are on Dangote Refinery, NNPC, and independent depot owners to see how this competition will shape the future of Nigeria’s energy market. For now, Nigerian consumers are reaping the benefits of lower fuel prices, but the broader challenges of corruption, infrastructure deficits, and equitable wealth distribution remain. The hope is that this newfound competition will pave the way for a more transparent and efficient oil sector—one that finally delivers on the promise of Nigeria’s vast natural resources for all its citizens.
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