Major marketers lift over 2m litres of petrol daily from Dangote Refinery

Nigeria’s petrol supply chain is shifting as members of the Major Energy Marketers Association of Nigeria (MEMAN) said it sourced 148,463,142 litres of Premium Motor Spirit (petrol) from Dangote Refinery between September 16 and November 24, 2024, averaging 2,120,902 litres daily in 10 weeks.

CEO of MEMAN, Clement Isong, revealed these figures during a quarterly webinar organised by the association on Wednesday. Speaking on the topic: Fuel Pricing, Isong, represented by Head of Economic Intelligence Research Regulation, Ogechi Nkwoji, explained that while MEMAN members have licenses to import PMS, they have in recent times relied on local supply from Dangote Refinery due to the competitive market framework already in place.

Nkwoji noted that products lifted from Dangote Refinery were transported via trucks and vessels to marketers’ facilities in Lagos, highlighting the operational flexibility within the supply chain. He further revealed that the product cost per metric tonne is estimated at N708,390, calculated using a foreign exchange rate of ₦1,665.99 to the dollar.

In a breakdown of volumes lifted during the 10 weeks, Isong stated that MEMAN members loaded 29,468,333 litres in Week 38 (September 16–22, 2024), followed by 20,843,322 litres in Week 39 and 27,236,283 litres in Week 40.

“However, volumes began to decline in subsequent weeks, reaching a low of 1,600,000 litres in Week 46. The supply slightly rebounded to 11,596,397 litres by Week 47 (November 18–24, 2024),” he said.

He disclosed that the spot price of petrol based on the 30-day pricing trend from October 10 to November 22, 2024, stands at ₦976.07 per litre, adding that the average price during the same period was ₦971.14 per litre.

Breaking down the factors influencing petrol pricing in Nigeria, Isong explained that critical cost components include the jetty location, such as ASPM, and a standard product quantity benchmarked at 38,000 metric tonnes.

He said, “The pricing methodology relies on the Argus Gasoline Euro-Bob benchmark for West African deliveries, combined with an average premium.

“The exchange rate is derived from the Central Bank of Nigeria’s (CBN) weighted average rate within the Nigerian Foreign Exchange Market (NFEM), which significantly impacts the final price,” he said.

Additionally, Isong noted that finance charges contribute heavily to the cost structure, pegged at 32% per annum over a 30-day cycle. Freight costs for Ship-to-Ship (STS) operations and related charges reflect a 10-day delivery timeframe to the ASPM jetty, Lagos Midstream Jetty (LMJ) located at the Lagos Apapa Harbour.

“Other local charges include those imposed by the Nigerian Ports Authority (NPA) for services such as towage, berthage, and cargo handling, as well as contributions to NIMASA at 2% of local freight and regulatory fees from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which add a combined 1% levy,” Isong said. He emphasised that the miscellaneous costs are capped at ₦2.00 per litre, further illustrating the country’s complex dynamics of fuel pricing.