The fuel supply agreement between Dangote Petroleum Refinery and a group of 20 major petroleum marketers has collapsed following disagreements over pricing, leading to a sharp rise in petrol imports into Nigeria.
The arrangement, reached in October 2025, was designed as a pilot scheme under which the selected marketers would collectively lift about 600 million litres of petrol monthly from the Dangote refinery. Each marketer was expected to offtake roughly 30 million litres, with the aim of stabilising domestic supply and easing pump prices.
However, industry sources confirmed that the deal broke down barely a month later after marketers accused the refinery of failing to adjust its gantry prices in line with declining international fuel benchmarks. While the agreement allowed for monthly price reviews, Dangote’s selling price reportedly remained higher than global import parity levels in November, prompting marketers to turn back to imports.
Data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority showed that petrol imports surged to about 1.56 billion litres in November 2025, coinciding with the height of the pricing dispute.
Under the initial deal, Dangote temporarily restricted direct sales to smaller independent marketers, forcing them to buy through the approved 20 marketers. This structure later became contentious as international petrol prices dropped below Dangote’s ex-depot rates.
Although the refinery eventually reduced its gantry price to N699 per litre, the cut came after marketers had already committed to imported cargoes, leaving many with losses on earlier purchases.
The collapse of the agreement has now pushed the refinery back to an open market model, allowing any marketer to buy petrol in quantities as low as 250,000 litres, while competition between locally refined fuel and imports intensifies across the downstream sector.
