Dangote’s PMS price hike will affect economy.
Dangote’s PMS price hike will affect economy.
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has warned that the recent increase in the price of Premium Motor Spirit (PMS), commonly known as petrol, by the Dangote Petroleum Refinery could have significant consequences for Nigeria’s economy.
The National President of PETROAN, Dr. Billy Gillis-Harry, said the price hike would create a ripple effect across several sectors of the economy, particularly transportation, logistics, and small businesses that depend heavily on fuel. According to him, the increase in fuel costs is likely to push up the prices of goods and services, thereby worsening the cost-of-living challenges currently facing many Nigerians.
The refinery recently increased its gantry price of petrol by ₦100, raising the ex-depot rate from ₦774 per litre to ₦874 per litre. Industry observers say this adjustment is already influencing pump prices at filling stations across parts of the country, with some outlets raising their prices to reflect the higher supply cost.
Speaking on the development, Gillis-Harry noted that petroleum retailers are concerned about the wider economic impact. He explained that higher petrol prices typically lead to increased operational costs for businesses, especially those that rely on transportation and power generation through fuel. These additional costs, he said, are often transferred to consumers in the form of higher prices for everyday goods.
PETROAN also emphasized that Nigeria’s downstream petroleum sector remains sensitive to global crude oil price fluctuations. When crude oil prices rise in the international market, the cost of refining and distributing petroleum products also increases, which ultimately affects the retail price of petrol within the country.
The association urged the government and relevant stakeholders to closely monitor the situation and implement policies that could help stabilize the market. According to PETROAN, maintaining price stability is important to protect businesses, support economic growth, and reduce inflationary pressure on households.
Economic analysts have also warned that frequent increases in fuel prices could slow down economic activities, particularly for small and medium-sized enterprises (SMEs), which form a major part of Nigeria’s economy. For many businesses already struggling with rising costs, another increase in fuel prices could reduce profitability and limit expansion.
Despite the concerns, stakeholders note that fuel pricing in Nigeria has largely been influenced by market forces following the removal of subsidies, meaning adjustments may continue whenever production and global oil costs change.
PETROAN, however, insists that careful management of the sector is necessary to prevent fuel price changes from placing additional strain on Nigerians and the broader economy.
