Private petroleum depots across Nigeria’s commercial hub Lagos and other key fuel trading centres have raised the wholesale price of petrol to as high as about US$0.53 per litre, tightening margins for marketers and fuelling expectations of higher pump prices nationwide.
Data compiled by industry tracker petroleumprice.ng showed that ex-depot prices for Premium Motor Spirit (PMS) climbed sharply within 48 hours, as traders adjusted prices amid supply uncertainty and foreign-exchange pressures.
Using prevailing parallel market exchange rates of around 1,495 naira to the dollar, petrol prices of 800 naira per litre translate to roughly US$0.53, while prices around 780 naira amount to about USS$0.52 per litre.
In Lagos, the Dangote depot typically the cheapest source of petrol sold PMS at about US$0.47 per litre on Friday, little changed from earlier in the week. While the increase at Dangote was marginal, other private depots implemented far steeper hikes.
Eterna and Integrated depots raised prices to around US$0.53 per litre, up from roughly US$0.49 per litre earlier in the week, representing an increase of nearly US$0.05 within two days. Aiteo and Lister depots also raised prices, selling petrol at about US$0.52 per litre, up from around US$0.50 previously.
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The price moves were even more pronounced in Warri, one of Nigeria’s key petroleum logistics hubs serving the Niger Delta and parts of the south. Matrix Energy and other depots, which sold petrol at roughly US$0.53 per litre midweek, raised prices to as high as US$0.54 by Friday.
Traders said Warri reacted faster to shifting market conditions due to tighter supply lines and higher transportation costs, as marketers repositioned volumes ahead of anticipated scarcity.
The increases come just weeks after Dangote Petroleum Refinery cut its ex-depot petrol price sharply in December, slashing rates from about US$0.55 to US$0.47 per litre, a move that briefly eased pressure across the downstream market following Nigeria’s removal of fuel subsidies.
Market participants say the latest price surge reflects a recalibration by importers and depot owners seeking to recover losses incurred during December’s aggressive price competition.
Jeremiah Olatide, chief executive of petroleumprice.ng, said importers were hit hard by Dangote’s price cuts, which forced many private players to sell petrol below their landing costs.
“This price uptick is a deliberate move by importers to recoup losses from the massive price slash by the Dangote Refinery in December,” Olatide said.
He added that traders are also pricing in the impact of a temporary shutdown of the refinery’s petrol unit for upgrades, which could limit domestic supply in the near term.
“Importers are postulating that there may be supply constraints in January because of the refinery’s plant upgrade, and they see this as an opportunity to make up for December losses,” he said.
Some depot operators, Olatide noted, are holding back volumes in storage in anticipation of selling at higher prices if supply tightens further.
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Currency weakness and global oil prices are also adding pressure. Brent crude settled at about US$60.20 per barrel on Friday, while the naira weakened in the parallel market to around 1,495 to the dollar, raising the cost of fuel imports despite growing domestic refining capacity.
Depot price movements typically precede adjustments at filling stations, and industry watchers warn that if current trends persist, retail petrol prices could rise above about US$0.47 per litre in several cities.
Since the full deregulation of Nigeria’s downstream petroleum sector, fuel prices have been determined by market forces, including crude prices, exchange rates, logistics costs and supply availability.
The 650,000-barrel-per-day Dangote Refinery had raised hopes of sustained price stability through local refining, but its temporary petrol unit shutdown has highlighted ongoing vulnerabilities in Nigeria’s fuel supply chain as imports remain costly and sensitive to currency movements.
