Despite the operational capacity of the Dangote Refinery and other local refineries, petroleum retailers and marketers in Nigeria continue to rely on imported petrol, citing concerns over competitive pricing, market monopolization, and inadequate domestic production. Stakeholders in the downstream sector have provided insights into the ongoing reliance on imports, even as the Dangote Refinery claims it can meet 100% of Nigeria’s petrol needs.
Key Reasons for Continued Imports
Price Instability and Lack of ConsultationBilly Gillis-Harry, President of the Petroleum Products Retail Outlet Owners Association (PETROAN), highlighted that sudden price reductions by the Dangote Refinery have left retailers at a disadvantage. For instance, the refinery recently slashed petrol prices from N889 to N825 per liter overnight, causing significant financial losses for retailers who had already purchased stock at higher prices. Gillis-Harry emphasized the need for price stability and consultation with stakeholders to ensure a fair and competitive market.
Inadequate Domestic Production
Tunji Oyebanji, former Chairman of the Major Marketers Association of Nigeria, noted that local refineries, including Dangote, are not yet meeting 100% of Nigeria’s petrol demand. This shortfall necessitates imports to bridge the gap. Oyebanji argued that if domestic refineries could produce sufficient quantities at competitive prices, marketers would have no reason to import.
Fear of Monopolization
Stakeholders have expressed concerns that the Dangote Refinery could dominate the market, leading to a monopolistic downstream sector. Gillis-Harry stressed the importance of a fully liberalized market where retailers can source products from multiple suppliers, including NNPC, Dangote, and importers, to avoid over-reliance on a single entity.
Conflicting Reports on Production Capacity
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) reported that domestic refineries, including Dangote, Port Harcourt, and Warri, met only 50% of national petrol demand in February 2025. However, the Dangote Refinery has countered this claim, asserting that it can fully meet Nigeria’s petrol requirements. This discrepancy has left stakeholders and consumers in confusion.
Economic Impact of Imports
Data from the National Bureau of Statistics revealed a 105% surge in petrol imports, reaching N15.4 trillion in 2024. In February 2025 alone, fuel imports hit N930 billion, raising concerns about the strain on Nigeria’s foreign exchange reserves and the sustainability of relying on imports despite local refining capacity.
Calls for Market Liberalization and Stability
Stakeholders are urging the government to ensure a fully liberalized and competitive downstream sector. Gillis-Harry emphasized that healthy competition and price stability are essential for the sector’s growth and the benefit of Nigerians. He also called for better collaboration between refineries and retailers to avoid sudden price changes that disrupt the market.
The ongoing reliance on imported petrol highlights the challenges facing Nigeria’s downstream petroleum sector. While the Dangote Refinery represents a significant step toward self-sufficiency, issues such as price instability, production shortfalls, and fears of monopolization continue to drive imports. Stakeholders are calling for a balanced approach that ensures market competition, price stability, and adequate domestic production to meet the nation’s fuel needs.