In what industry observers are describing as a strategic move to dominate Nigeria’s diesel supply chain, the Dangote Petroleum Refinery has once again reduced its depot price for Automotive Gas Oil (AGO), bringing it down from ₦990 to ₦960 per litre. The new rate, which applies specifically to large-scale bulk purchases of two million litres or more, has triggered fresh ripples across the downstream sector, intensifying the ongoing price competition among fuel marketers.
The price adjustment, confirmed by multiple industry sources, is already mounting pressure on independent petroleum depots, many of which are still selling diesel between ₦985 and ₦990 per litre. These non-refinery operators, who rely heavily on imports or third-party sourcing, now face the difficult challenge of either matching Dangote’s new benchmark or risk losing a growing share of the wholesale market to the newly operational refinery.
Dangote’s refinery, located in Lagos and boasting a nameplate capacity of 650,000 barrels per day, has increasingly positioned itself as a game-changer in Nigeria’s petroleum landscape. Since commencing diesel supply earlier this year, it has moved aggressively to set market trends, adjusting prices multiple times to reflect both global oil movements and strategic business objectives.
Market stakeholders say the latest cut is likely aimed at attracting large-scale commercial buyers, including transport companies, logistics firms, and heavy industries, many of whom are constantly in search of cheaper, more reliable diesel sources amid volatile forex rates and lingering import costs. By underpricing its competitors at scale, Dangote appears to be consolidating control not just over refining, but also over domestic pricing dynamics in the downstream market.
Meanwhile, depot owners and fuel marketers who cannot match the refinery’s economies of scale are raising concerns about sustainability. Some argue that without government intervention or a levelled playing field, independent operators may be pushed out of business in the long run.
With diesel playing a critical role in powering Nigeria’s economy, from factories and generators to transport fleets, the ripple effects of Dangote’s pricing strategy are expected to deepen in the coming weeks. As buyers pivot toward more affordable supply options, the structure of the diesel market may be headed for a fundamental shift.
