‘It’s Not Just Hormuz’ – Dangote Explains Why Petrol Is Expensive In Nigeria

Nigeria’s petrol market may face a more serious challenge with product availability than price as geopolitical tensions continue to unsettle the global energy market.

The warning came from President of Dangote Industries Limited, Aliko Dangote.

Dangote said the ongoing crisis in the Middle East could put pressure on petroleum supply chains, potentially shifting attention from how much motorists pay for petrol to whether sufficient volumes would be available.

“The problem now, going forward, I must also warn that this crisis in the Middle East is not even about price; it’s about availability,” he said in an interview aired by Arise TV.

His warning comes amid persistent concerns over the high cost of petrol in Nigeria.

Consumers are already contending with high transportation and living costs following the sharp increase in pump prices since the removal of fuel subsidy.

But Dangote maintained that the Nigerian market should also be viewed against developments in neighbouring countries.

He said petrol is reportedly sold at substantially higher prices.

According to him, the price gap has continued to create incentives for the movement of Nigerian petrol across the borders, putting additional pressure on domestic supplies.

“I don’t know if you know that there’s still a lot of smuggling of the same petrol we are producing to our neighbouring countries,” Dangote said.

He put the price difference between Nigeria and some neighbouring countries at between 30 and 50 per cent.

The oil mogul argued that such a margin makes the illicit trade highly attractive.

“Because those neighbouring countries are about 30 to 50 per cent more expensive than Nigeria. So, it’s not actually like for like,” he said.

Citing Niger Republic as an example, he said petrol could sell there for 20 to 25 per cent more than in Nigeria.

Using a Nigerian price of N1,350 per litre as an illustration, he questioned whether many legitimate businesses could offer traders an immediate return of about 25 per cent.

“So, what business are you going to do that will make you have an instant 25 per cent return?” he asked.

He said the incentive could encourage diversion of petrol meant for Nigerian consumers to border communities, where it can be sold at a premium.

“You pretend you are taking it to Sokoto, you go and just take it to Ilela, and you sell,” he said.

Despite the potential supply pressures, Dangote assured Nigerians that his refinery would continue supplying the domestic market.

“We will deliver to Nigeria. Nigerians don’t need to worry. There will not be any shortage from our own part.

“There won’t be any shortage. There will not be any queues. We will make sure that we keep satisfying the market, despite all odds,” he added.

The comments came as the Dangote Petroleum Refinery and Petrochemicals commenced a N2.15 trillion initial public offering on the Nigerian Exchange.

The offer comprises 4.1 billion ordinary shares priced at N525 each, with a minimum subscription of 10 shares valued at N5,250.

The IPO is open to retail, institutional and eligible African investors and is scheduled to close on October 13, 2026.

The refinery’s offer also represents a major development for Nigeria’s capital market, being the first petroleum refinery to be offered to investors on the Nigerian stock market in the Exchange’s 66-year history. (Daily trust)