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How Nigerians, marketers reacted to Dangote’s fuel distribution plan

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Reactions have continued to trail the announcement by Dangote Refinery of its planned free distribution of Premium Motor Spirit (PMS) and diesel to stakeholders across key sectors in Nigeria.

Tribune Online reports that the refinery, in a statement issued recently, said the national free logistics initiative would commence on August 15, targeting marketers, petrol dealers, manufacturers, telecom firms, aviation operators, and other large-scale fuel users.

The refinery noted that it had procured 4,000 brand-new Compressed Natural Gas (CNG)-powered tankers to support the rollout of the initiative.

The company added that the initiative is part of a broader effort to eliminate logistics costs, improve energy efficiency, and enhance affordability, with benefits expected to cut across multiple sectors.

The development has continued to spark reactions from social media users and marketers, with some suggesting it may threaten the dominance of the Nigerian National Petroleum Company Limited (NNPCL) in the fuel supply market.

An X user, @indulge_tweets, wrote, “NNPC should be worried at this point, they should gear up with the refinery opening to create a direct competition before it becomes monopoly.”

Another user, @gabriel_bolatit, tweeted, “It’s very obvious fuel marketers will not like this approach because Dangote is ready to run them out of business. May Nigeria 🇳🇬 and Nigerians win 🏆 this war.”

ALSO READ: JUST IN: Dangote Refinery procures 4,000 CNG tankers, to distribute fuel nationwide 

“Wow….this would serve as a major boost for Nigeria economic development. I believe Dangote has the capacity to sell petrol at N600 to Nigerians. This is a welcome development,” @Olugbengacool opined.

@ChigozieAkomas wrote, “This is indeed a noble initiative. I pray and hope we will see a reflection of this noble initiative in the pump prices of the products in retial stations.”

“This is a groundbreaking heartwarming economic rejuvenation for Nigeria. NNPC should take a cue. God bless Aliko Dangote. ProudlyNaija 🇳🇬💖,” @TeddyKing4real tweeted.

However, oil marketers under the aegis of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) expressed concern over the development, warning that the Dangote Petroleum Refinery’s plan to distribute fuel directly to filling stations and other end-users nationwide could distort the market.

They argued that with a capacity of 650,000 barrels per day, the Dangote refinery should focus on refining and exporting fuel rather than competing directly in the retail distribution chain.

“This massive refinery, one of the largest in sub-Saharan Africa, is expected to satisfy domestic fuel demand and export surplus products,” the oil dealers said in a statement signed by PETROAN’s Publicity Secretary, Joseph Obele, on Monday.

The association maintained that it had earlier warned about the refinery’s intentions to dominate the downstream sector, raising fears that “the company may leverage its market power to fix prices, limit competition, and exploit consumers, much like it has done in other sectors.”

PETROAN further stated that Dangote might be deploying a price penetration strategy, offering fuel at low prices to seize market share and force smaller players out, ultimately threatening the survival of independent operators.

“This could lead to a massive shutdown of filling stations across Nigeria, resulting in widespread job losses. The introduction of 4,000 brand-new Compressed Natural Gas-powered tankers by the Dangote refinery poses a significant threat to the livelihoods of thousands of truck drivers and owners. While CNG trucks may offer a lower cost of transporting petroleum products, this shift could lead to widespread job losses in the industry,” the statement added.

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