Dangote Refinery may cut petrol supplies to import-dependent marketers over quality

Dangote Petroleum Refinery and Petrochemicals may soon limit petrol supplies to key marketers who continue importing Premium Motor Spirit (PMS) into Nigeria, according to sources familiar with the refinery's stance. The proposal could be implemented as early as this week, pending further discussions and any last-minute adjustments.

This move reflects mounting worries over the continuous import of petrol in a market that now boasts considerable domestic refining capacity, as well as the quality and transparency of products bearing the Dangote brand.

Sources suggest that certain marketers are allegedly combining imported petrol with products purchased from Dangote Refinery before selling the combined product to consumers. The refinery is particularly concerned that such practices could complicate the differentiation between products directly supplied by the refinery and those that have been blended or manipulated by third parties.

This issue underscores the refinery's apprehension that the mixing of its products with imported petrol of questionable quality could undermine the reputation and integrity of goods sold under the Dangote brand.

Nigeria's downstream petroleum sector is in the midst of a significant shift, moving away from extensive import dependency towards increased domestic refining. As the country's largest refiner, Dangote Petroleum Refinery, with a capacity of 700,000 barrels per day, plays a crucial role in supplying refined petroleum products to both the Nigerian and international markets.

The refinery has also strengthened its footprint in the global jet fuel market, surpassing traditional exporters from the United States and the Middle East in consecutive months.

In November 2024, Dangote Refinery had previously criticized an unnamed international trading company for allegedly hiring a local depot to mix substandard products, potentially competing with the refinery's superior-quality offerings in the Nigerian market. The recent proposal to restrict petrol supplies to marketers highlights the escalating friction between domestic refiners and marketers who still depend on imported petroleum products as Nigeria progresses towards a more self-sufficient refining sector.