Fuel Prices May Drop as Dangote Expands Free Delivery to Four States

The Dangote Petroleum Refinery has expanded its free petroleum products delivery programme to four additional states, in a move aimed at reducing distribution costs for independent petroleum marketers and creating room for lower petrol prices.

The newly added states are Kano, Imo, Anambra and Nasarawa, bringing the initiative to a wider part of the country. The programme previously covered Lagos, Ogun, Rivers, Kaduna, the Federal Capital Territory and Delta State.

Under the arrangement, Dangote Refinery absorbs the cost of transporting petroleum products from the refinery to selected customers, removing a major expense from the downstream distribution chain.

The company said the initiative is designed to bring products closer to marketers and retailers while reducing the cost and risks associated with transporting fuel over long distances.

Fatima Aliko-Dangote, Group Executive Director, Commercial Operations, Oil & Gas, WAEP and Fertiliser, said the objective was to ensure that the benefits of domestic refining extend beyond the refinery gate.

She said absorbing delivery costs would remove a significant part of the distribution burden and create room for savings to be passed along the value chain to consumers.

“Our goal is to make fuel distribution more efficient, reduce avoidable costs and support more competitive pump prices across Nigeria,” she said.

The expansion is expected to particularly benefit marketers operating far from the Dangote refinery in Lagos, where transportation expenses can significantly increase the cost of petroleum products.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) has welcomed the initiative, saying it could ease financial and logistical pressures on independent marketers.

IPMAN spokesman Chinedu Ukadike said free delivery could help reduce the amount of time marketers’ funds remain tied up in the supply chain and improve the efficiency of their operations.

The programme comes as Nigeria’s downstream petroleum sector continues to adjust to increased domestic refining capacity and greater competition.

Dangote Refinery has also been expanding its production and distribution operations, with its growing output contributing significantly to Nigeria’s refined petroleum product exports. The US Energy Information Administration recently reported that Nigeria’s seaborne petroleum product exports have risen sharply since the refinery began ramping up production.

For motorists and other fuel consumers, the key question will be whether the reduction in logistics costs translates into lower pump prices.

Dangote Refinery has indicated that the programme is intended to create that opportunity, while further expansion to other locations could widen the potential impact across the country.