Aliko Dangote says Nigeria’s petrol price remains below prices in neighbouring countries, arguing that the price gap is encouraging the smuggling of Nigerian fuel across borders.
President of Dangote Industries Limited, Aliko Dangote, has said petrol selling at about N1,350 per litre in Nigeria remains cheaper than the product in neighbouring countries.
Dangote said the price differential is encouraging cross-border smuggling, with Nigerian petrol being moved into neighbouring countries where it can command a higher price.
Using Niger as an example, Dangote said petrol costs about 20 to 25 per cent more in the neighbouring country than in Nigeria.
He argued that the disparity creates an incentive for traders to move petrol across Nigeria’s borders rather than sell the product domestically.
The development is significant for Nigeria’s downstream petroleum market, particularly following the removal of petrol subsidy and the emergence of domestic refining as a larger component of fuel supply.
Dangote has previously linked fuel smuggling to distortions in Nigeria’s petroleum market, arguing that significant volumes of locally refined petrol can leave the country through unofficial channels.
The Dangote Refinery, which has become a major supplier to Nigeria’s domestic market, has been at the centre of discussions about petrol pricing, supply security and the country’s transition away from dependence on imported refined products.
Dangote’s latest comments therefore highlight a continuing challenge: ensuring that cheaper domestic fuel prices benefit Nigerian consumers rather than creating an arbitrage opportunity for cross-border traders.
The price disparity between Nigeria and neighbouring markets is likely to remain an important issue for policymakers as the country adjusts to a deregulated petroleum market.