Dangote Petrol Price Hikes Raise Questions Over What Drives Pump Prices — EBC

By Samuel Temiloluwa

LAGOS, September 7, 2026 — The three successive increases in the price of Premium Motor Spirit (PMS), popularly known as petrol, by Dangote Petroleum Refinery within nine days have raised fresh questions over the factors determining petrol prices in Nigeria.

Dangote Refinery increased its ex-gantry petrol price from ₦1,165 per litre on August 21 to ₦1,185, then ₦1,200 and eventually ₦1,265 per litre on August 29, representing a cumulative increase of ₦100, or about 8.6 per cent.

According to an analysis released by EBC Financial Group, the timing and varying sizes of the increases do not appear to correspond neatly with the refinery’s explanation that its prices were influenced by the cost of crude oil purchased weeks earlier.

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David Precious, Senior Market Analyst at EBC Financial Group, said an explanation based on stored crude costs would ordinarily be expected to result in an adjustment reflecting the difference between the old and new crude costs and the point at which the more expensive crude entered the refining process.

He noted that the three increases—₦20, ₦15 and ₦65—occurred within nine days, with the largest adjustment coming when international crude prices were still declining.

“An explanation based on stored crude cost should predict one increase, sized to the gap between old and new cost, timed to when the costlier oil entered the refining process,” Precious said.

He added that the sequence did not necessarily prove that Dangote’s explanation was false, but argued that it had not fully accounted for the timing and magnitude of the adjustments.

The development has also attracted attention because of Dangote Refinery’s reported plans for a stock market listing, with the company reportedly seeking a valuation approaching $40 billion.

EBC said investors may therefore want greater clarity on the refinery’s pricing structure and the relationship between its crude acquisition costs, refining costs and selling prices.

Crude Prices Fell as Petrol Prices Rose

The EBC analysis noted that Brent crude, the international benchmark, fell from about $95 per barrel on August 21 to around $86 by August 26, representing a decline of nearly 10 per cent in five trading days.

However, the two largest Dangote petrol price increases occurred during this period of falling crude prices.

Brent only moved back above $90 per barrel on August 31, two days after Dangote’s ₦65 increase took effect. According to EBC, the subsequent rebound in crude prices could therefore potentially explain a later price adjustment, rather than the August 29 increase.

Dangote has maintained that its pricing reflects the cost of crude already purchased and delivered for processing rather than the prevailing spot price of crude oil.

The refinery’s position is that crude purchased when international prices were higher may take weeks to move through negotiation, loading, shipping and discharge before it becomes available for refining. Consequently, a decline in the current international price does not automatically translate into a lower cost for crude already held in storage.

NNPC Also Adjusted Prices

The National Petroleum Company Limited (NNPC) also adjusted its petrol prices shortly after the Dangote increases.

Its Abuja pump price reportedly rose from ₦1,250 to ₦1,270 per litre, while its Lagos price moved from ₦1,210 to ₦1,225 per litre.

Chinedu Ukadike, National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), said retailers were compelled to adjust their pump prices because their acquisition costs had increased.

EBC, however, said the rapid movement of prices across the market makes it more difficult for consumers and other market participants to determine whether individual increases are driven strictly by underlying costs or include changes in margins.

The analysis stressed that the developments did not establish any form of coordination between suppliers.

Import-Parity Price Raises Further Questions

The analysis also referenced the Major Energies Marketers Association of Nigeria’s August 27 Energy Bulletin, which placed Dangote’s gantry price at ₦1,200 per litre against an estimated spot import-parity price of ₦1,222.32.

This meant that Dangote’s price was approximately ₦22 below the estimated import-parity level at the time.

Two days later, however, the refinery’s price increased to ₦1,265 per litre, putting it about ₦43 above that earlier reference price.

EBC cautioned that the comparison should not be treated as a definitive measure because there was no continuously published live benchmark showing exactly how import-parity costs changed during the period.

The group said the broader issue was whether market participants could independently determine, at the time of each price adjustment, whether the increase reflected actual costs.

Diesel Price Also Increased

Dangote subsequently made a separate adjustment to the price of Automotive Gas Oil (diesel).

On September 4, the refinery increased its ex-gantry diesel price by ₦100, from ₦1,750 to ₦1,850 per litre, representing an increase of about 5.7 per cent.

EBC said the diesel adjustment was separate from the three August petrol increases, adding that Dangote’s petrol gantry price remained at ₦1,265 per litre in the latest market data cited in its September 7 release.

Call for Greater Transparency

The debate comes amid repeated assurances from the Presidency and Dangote that increased domestic refining and arrangements allowing refiners to purchase crude in naira would reduce Nigerians’ exposure to fluctuations in international crude prices.

EBC argued that the recent sequence of petrol price increases highlights the need for greater transparency in refinery pricing.

According to the financial services group, publishing a cost breakdown for each price adjustment—including the crude cargo involved, purchase date, purchase price and discharge date—would enable marketers, regulators and prospective investors to better assess the basis of price changes.

“With Dangote preparing to list at a reported valuation of nearly $40 billion, such disclosure may become increasingly important for investors seeking to understand how the refinery’s pricing decisions affect its profitability and market position,” the report stated.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) had also identified several factors behind petrol-price volatility, including crude sourcing, domestic refinery supply, refinery delivery timelines, logistics and transportation costs.

EBC said this broader explanation makes refinery-specific disclosure even more important because international crude prices alone cannot determine which particular cost component triggered an individual price increase.

The group concluded that without greater disclosure, consumers, regulators and investors may continue to rely on explanations that are plausible but difficult for outsiders to independently verify.

DemocracyNewslineNewspaper, September 7, 2026