Dangote Petroleum Refinery & Petrochemicals has reaffirmed its commitment to ensure stable fuel supply in Nigeria, despite recent disruptions in the global oil market caused by refinery shutdowns and geopolitical tensions.
The company said the ongoing conflict in the Middle East and restrictions on fuel exports by China have triggered global shortages of petroleum products. It, however, assured that Nigeria remains largely insulated from the shocks because the refinery prioritises supply to the domestic market.
According to the refinery, rising global crude oil and freight costs have pushed benchmark Brent crude prices up by about 26 percent to over 84 dollars per barrel. In response, the refinery implemented a measured adjustment of 100 naira per litre in its ex-depot price of Premium Motor Spirit (PMS), representing about a 12 percent increase.
The company explained that it absorbed about 20 percent of the cost escalation to cushion the impact on consumers, even as it continues to purchase crude at international market rates. It added that Nigerian crude sells between 3 and 6 dollars above the Brent benchmark, with additional freight costs pushing landing prices to between 88 and 91 dollars per barrel.
The refinery further disclosed that while Nigerian National Petroleum Company Limited supplies about five cargoes of crude oil monthly in naira, it requires 13 cargoes to meet domestic demand. As a result, it must source additional crude through international traders and obtain foreign exchange at open market rates, a situation worsened by some producers’ failure to meet supply obligations under the Petroleum Industry Act.