The Nigerian downstream oil sector is witnessing a power struggle between established oil marketers and the newly operational Dangote Petroleum Refinery, a $20 billion behemoth poised to reshape the nation’s fuel landscape. Aliko Dangote, the president of the Dangote Group, has publicly accused entrenched interests and oil cabals of sabotaging his refinery’s operations by continuing to import vast quantities of petrol and resisting purchasing from his facility. This resistance persists despite the refinery’s increased production capacity and improved output, leading to a contentious battle for market share and control of the downstream sector. Dangote’s accusations suggest a deliberate attempt to undermine his refinery and maintain the status quo of reliance on imported fuel, a system that has allegedly benefited certain players for decades.
Data reveals a stark contrast between the refinery’s potential and the continued reliance on imported petrol. Between March 1 and May 9, 2025, marketers imported 2.57 billion litres of petrol, a substantial volume suggesting a significant reliance on foreign supply despite the Dangote refinery coming online. This import volume translates to a staggering expenditure of N2.42 trillion, adding to the already substantial N4.51 trillion spent on petrol imports between October 2024 and February 2025. The continued importation of petrol, despite the availability of locally refined product, raises questions about the motives of the marketers and the potential influence of vested interests seeking to protect their established positions within the industry.
Dangote’s accusations of sabotage are not new. He has consistently raised concerns about alleged efforts to undermine his refinery, claiming that some international oil companies have restricted crude supply to his facility and that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has been issuing licenses for the import of substandard petroleum products. These actions, he argues, are designed to stifle the growth of his refinery and maintain the dominance of imported fuel. Dangote’s frustration has been evident in his past statements, even expressing regret at building the refinery due to the fierce resistance he has faced from entrenched interests. He remains resolute, however, confident that he will ultimately prevail in this struggle for market share and establish his refinery as a key player in the Nigerian downstream sector.
Despite Dangote’s claims of sabotage, official data from the NMDPRA indicates a significant decrease in daily petrol imports, falling from 44.6 million litres in August 2024 to 14.7 million litres by April 2025. This reduction is attributed to increased domestic production from the Dangote refinery, the Port Harcourt refinery, and modular refineries. The Nigerian National Petroleum Company Limited (NNPCL), formerly a major importer, has also shifted its strategy, sourcing products directly from the Dangote refinery. This shift suggests a growing recognition of the refinery’s potential and a move towards greater self-sufficiency in petrol production. However, the conflicting narratives between Dangote’s accusations and the NMDPRA data highlight the complex dynamics at play within the downstream sector.
Varying perspectives emerge from within the industry regarding this evolving landscape. While some stakeholders advocate for a level playing field and healthy competition, others express concerns about the potential for market destabilization. The Independent Petroleum Marketers Association of Nigeria (IPMAN) welcomes the competition and price reductions brought by the Dangote refinery, acknowledging the challenges posed to established business strategies but recognizing the overall benefit to consumers. The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) calls for harmony within the sector, suggesting a balanced approach where both local refining and imports can coexist. This perspective advocates for a fair market where all players can operate without undue interference or favoritism.
Conversely, the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) warns of the potential dangers of a monopoly emerging from the Dangote refinery’s significant capacity. While acknowledging the need for domestic refining, DAPPMAN stresses the importance of maintaining a diverse supply chain and avoiding over-reliance on a single entity. DAPPMAN alleges that the Dangote refinery favors selective sales to certain marketers, limiting access for others and creating an uneven playing field. They also highlight the financial challenges faced by depot owners, emphasizing the high costs associated with importing and distributing fuel and the impact of price fluctuations on their profitability. This multifaceted situation underscores the need for a carefully managed transition in the downstream sector, balancing the benefits of increased domestic refining with the need to maintain a competitive market and ensure fair access for all stakeholders.
