PMS: Marketers stick with Dangote amid deepening price war

Oil and gas marketers yesterday said they would continue to patronise Dangote Refinery despite the price disparity in the market even as competition has deepened in the petroleum sector. This is just as sources close to the refinery told our correspondent that the price might still come down as soon as the international crude oil […]

Oil and gas marketers yesterday said they would continue to patronise Dangote Refinery despite the price disparity in the market even as competition has deepened in the petroleum sector.

This is just as sources close to the refinery told our correspondent that the price might still come down as soon as the international crude oil price drops.

Daily Trust reports that Dangote had recently announced an upward review of the price of Premium Motor Spirit (PMS) also known as petroleum from N899.50 to N955.

This has increased the price of PMS at filling stations affiliated to Dangote from N935 to N970.

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The Nigerian National Petroleum Company Limited (NNPCL) had also adjusted its price from N925 to N970 even as filling stations sell at different prices ranging from N970 to N990 as checks by our correspondent revealed.

However, over the weekend the landing cost of imported PMS dropped to N922.65 per litre from N943.75 per litre it sold previously.

Marketers who spoke with our correspondent stated that the price continues to change on a daily basis and it would be risky to switch as the price is not stable.

“What you have seen is not unusual. This is a dynamic market and price changes on a daily basis and it is now left for the marketers to be meticulous in taking a decision,” a marketer said yesterday.

Also, the Executive Secretary of Major Energies Marketers’ Association of Nigeria (MEMAN), Mr Clement Isong, in a chat with our correspondent also said marketers with continue the patronage of Dangote Refinery.

“You know this oil market we are talking about is not like the same market down the road, the market is fragile, the price goes up and down on a daily basis, you can’t base it on the price you bought today, by the time you go back there tomorrow the price has gone up.

“If you follow the international market, you will find out that what happened was Joe Biden (former US president) increased the sanction against Russia and international prices went up, now Biden has left office.

“When Trump came, he said Russia must find a solution with Ukraine, so the price started coming back down. So nationally the price has started coming back down,” he said.

Another expert who spoke on the condition of anonymity said competition would continue to drive down the price in the market.

He said, “As we always said, deregulation will lead to fierce competition.  Some entities may not survive. Only the efficient, with strong management may weather the storm. Indiscriminate development of tank farms and unviable petrol stations will be exposed. Those whose business model was dependent on only being connected in the supply chain will struggle.”

Another source close to Dangote stated that landing cost alone does not make up the cost the product is sold to consumers, adding, “There are other costs which aren’t stated.”