The announcement yesterday, Sunday November 24, 2024, by the Dangote Group that it has reduced the price of its petrol from ₦990 to ₦970 per liter is a national insult and a glaring affront to Nigerians, who continue to endure economic hardship under the weight of exorbitant fuel prices. At a time when imported fuel is available at significantly lower prices, this tokenism is an insult to a nation struggling with skyrocketing inflation, currency devaluation and declining purchasing power. The negligible price reduction is a calculated public relations (PR) stunt than a genuine attempt to alleviate the suffering of the masses. The paltry ₦20 reduction, framed as a magnanimous act of appreciation to Nigerians, is a stark reminder of the systemic exploitation embedded in the nation’s energy policy, under President Bola Tinubu. Far from a gesture of goodwill, this token measure of appeasement is designed to pacify public outrage while maintaining sky-high profit margins for Dangote. The price reduction is not a victory for Nigerians; it is a calculated move to maintain the illusion of Dangote’s benevolence while preserving his monopolistic control. Nigerians deserve better than a system rigged against them.
In a statement released on Sunday, the Dangote Group Chief Branding and Communications Officer, Anthony Chiejina, shamelessly and unpretentiously said the reduction was to appreciate Nigerians for their patronage. “As the year comes to an end, this is our way of appreciating the good people of Nigeria for their unwavering support in making the refinery a dream come true. In addition, this is to thank the government for their support as this will complement the measures put in place to encourage domestic enterprise for our collective well-being.” While Dangote apologists argue that local production reduces reliance on imports, this assertion rings hollow when the end product is priced higher than imported alternatives. The question then arises: who benefits from this so-called self-reliance? Certainly not the average Nigerian, who is forced to choose between fueling their vehicle or putting food on the table.
The unfolding drama in Nigeria’s oil sector underscores a captive market under a monopoly. The troubling reality is that the rise of the Dangote Refinery as an unchallenged behemoth, coupled with government complicity and underhanded dealings, has placed an undue burden on Nigerians. Dangote Refinery, once hailed as a solution to Nigeria’s fuel import dependency, now epitomizes the dangers of unchecked monopolistic power. With the refinery becoming the primary supplier of petroleum products in the country, competition has been effectively stifled. Despite deregulation, the grip of Dangote on the market ensures price reductions remain minimal and cosmetic. At ₦970 per liter, Dangote’s pricing is still higher than the ₦971 landing cost of imported fuel. This monopolistic control contradicts the essence of deregulation, which should foster competition and drive down prices. Instead, Dangote’s dominance guarantees inflated costs, forcing Nigerians to shoulder the financial burden of inefficiency and profit maximization.
The government’s role in fostering this monopoly is as troubling as the monopoly itself. Through tacit support and regulatory inaction, it has effectively prioritized the interests of Aliko Dangote over the welfare of Nigerians. The reported agreements between Dangote, oil marketers, and the government, which obligate stakeholders to prioritize Dangote refinery’s products, especially the agreement that NNPC, oil marketers, and other traders like depot owners will patronize the Dangote refinery by lifting 28 million liters of petrol daily for the next six months, underscore this disturbing alliance. Even as independent marketers initially balked at Dangote’s high prices, they were eventually coerced by the Tinubu administration into compliance. This arm-twisting has stifled dissent and reinforced the monopoly, leaving no room for genuine market dynamics. The result? A captive market where Nigerians pay exorbitantly for locally produced fuel, despite bearing the economic weight of subsidies and infrastructure development to support Dangote’s operations.
The so-called price reduction reeks of a public relations strategy aimed at deflecting criticism rather than addressing the systemic issues plaguing the sector. Statements framing the reduction as a gesture of appreciation ring hollow when Nigerians are still paying some of the highest fuel prices in recent history. Moreover, claims of competition driving down prices are disingenuous. The insignificant drop in prices attributed to marketers bypassing middlemen does little to address the structural monopoly. The narrative of “competition” is a smokescreen, obscuring the reality of a market controlled by Dangote with government backing.
The Dangote monopoly sets a dangerous precedent for Nigeria’s energy sector. By centralizing power in one entity, the nation risks replicating the inefficiencies and corruption that plagued the former subsidy regime. Furthermore, the lack of accountability and transparency in the pricing mechanism erodes public trust and exacerbates economic disparities. This monopoly also stifles innovation and growth. Independent marketers, once a vibrant force in the sector, now operate at the mercy of Dangote’s pricing and supply policies. Local refineries and smaller players are effectively sidelined, diminishing the sector’s potential for diversification and resilience.
The Dangote Refinery’s stranglehold on Nigeria’s oil sector is a cautionary tale of how monopolies, left unchecked, can exploit a nation under the guise of progress. To safeguard Nigeria’s economic future, urgent reforms are needed to dismantle this monopolistic stranglehold. The government must foster genuine competition by supporting alternative refineries, encouraging imports where necessary, and ensuring transparent pricing mechanisms. Regulatory bodies must act as impartial arbiters, prioritizing the interests of the nation over corporate alliances. Furthermore, civil society and industry stakeholders must demand transparency, competition and accountability and resist the normalization of monopolistic practices. The narrative that Dangote Refinery is the savior of Nigeria’s energy woes must be challenged with facts and vigilance. The government must break Dangote’s monopolistic stranglehold, encourage competition, and ensure that pricing mechanisms are transparent and fair. Anything less is a betrayal of the Nigerian people.
