Dangote Petroleum Refinery has partnered with major fuel marketers to ensure nationwide supply and mitigate risks linked to reliance on a single-source system, the Major Energies Marketers Association of Nigeria (MEMAN) said.
Speaking at a MEMAN webinar on Tuesday, Chairman Hubb Stokman explained that the supply arrangement was designed to enhance operational efficiency and address concentration risks in the downstream sector.
“Sometimes you forget, in a situation like this with the crisis in the Middle East, that having a refinery that can produce a large part, if not almost everything, that the country needs is a huge benefit,” Stokman said, noting that deliberate efforts were required to spread supply channels given the size of the mega refinery.
The arrangement, he added, was implemented in consultation with regulators to ensure it aligns with market realities and promotes efficient distribution.
Stokman highlighted the impact of the ongoing Middle East conflict, which has triggered global oil market volatility and underscored the need for flexibility in supply arrangements. Despite these challenges, he said Nigeria’s market has responded positively so far, thanks to the strategic coordination.
He emphasised that rigid approaches to market management could undermine responsiveness in a volatile environment, praising the refinery and market players for their agility.
On fuel pricing, Stokman noted that Nigeria’s deregulated system continues to reflect international benchmarks, with import parity guiding domestic prices. The regulator, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), maintains a needs-based approach to import licensing, ensuring supply security, he said.
The role of the Nigerian National Petroleum Company Limited (NNPC) remains critical as a supplier of last resort to maintain stability and continuity of petroleum product distribution across the country.
Joe Nwakwue, a partner at Zeta Advisory and Consulting, stressed the importance of promoting a competitive or “contestable” market to prevent dominance by any single supplier. He added that imports remain crucial for sustaining competition and mitigating price distortions.
Nwakwue also cautioned that while Nigeria is exposed to global oil market volatility, policies such as the naira-for-crude arrangement could be used to buffer domestic refining from international price swings. He warned that mixed regulatory signals could undermine market confidence and that rising petrol prices, if unchecked, could negatively affect economic growth.
He recommended targeted, temporary interventions to prevent extreme fuel price spikes rather than an open-ended subsidy regime, stressing the importance of designing measures that protect consumers without destabilising the economy.
