“The problem we are facing in this country is an open problem. We have only one source of refined petroleum products, which is Dangote Refinery. Any move by Dangote Refinery affects marketers.
“If there were other functional refineries such as NNPCL Port Harcourt, Warri, Kaduna and other modular refineries, the problem of the inability for marketers to buy the product won’t arise, because they can be accessed from multiple sources,”
The position of petrol retailers and marketers showed that Nigeria is experiencing what economists call a “false equilibrium”— a temporary price stability that is not rooted in market fundamentals.
Such stability often collapses once cost pressures mount or supply bottlenecks emerge.
Both PETROAN and IPMAN agree on the core dangers: one refinery controlling supply leads to price instability;
IPMAN’s spokesperson, Chinedu Ukadike, the controversy goes deeper into Nigeria’s structural petroleum problems.
He said on paper, the Petroleum Industry Act (PIA) fully deregulated the downstream market.
“In reality, deregulation cannot function when only one major domestic refinery— the Dangote Refinery— is active while government-owned refineries in Port Harcourt, Warri and Kaduna remain grounded,” he stated.
A deregulated market is supposed to operate on a “willing seller, willing buyer” basis, with fluctuating prices driven by competition, cost variations, and supply diversity. But with Nigeria depending on a single source of refined products, market forces are effectively weakened.
Ukadike argued that if state-run refineries and modular refineries were functional, the current volatility and the vulnerability of marketers would not exist.
“Multiple sources of supply would create real competitive pricing, reducing the risk of sharp price movements tied to one supplier.
“Well, the Petroleum Industrial Act has deregulated the petroleum market. In a deregulated petroleum market you can’t fix the price.
“It is a deregulated market influenced by forces of demand and supply. It gives room for a free economy and a willing-buyer-willing-seller relationship.
“Marketers’ prices will keep fluctuating. But it has to keep on fluctuating for competitive prices.
Marketers may soon struggle with capital to purchase products; artificially low prices threaten long-term availability, and true deregulation cannot exist without multiple competing refineries.
If the current pricing trend continues without structural reforms, Nigeria may face renewed fuel scarcity, abrupt price spikes, or supply disruptions.
Way forward
Nigeria’s petrol market finds itself in a vacuum — deregulated by law yet functionally dependent on only two suppliers, Dangote Refinery or imported products.
The result is a sector where neither government regulation nor market competition is strong enough to guarantee stability.
For now, cheaper pump prices offer short-term relief to Nigerians already battling inflation and economic hardship.
But industry players say the country must choose between the illusion of low prices today and the sustainability of petrol availability tomorrow.
Until Nigeria diversifies its refining capacity, restores public refineries, and strengthens market competition, the debate over petrol pricing will remain a recurring national dilemma.
