The price of Automotive Gas Oil, popularly called diesel, produced by the Dangote Petroleum Refinery has increased from N940/litre to N1,100/litre due to the crash of the naira against the United States dollar, it was gathered on Tuesday.
Recall that on April 24, 2024, Dangote refinery announced a further reduction in the prices of diesel and aviation fuel to N940/litre and N980/litre respectively.
Earlier, precisely on April 17, Dangote refinery reduced the cost of the commodity from N1,200/litre to N1,000/litre.
In about a week, the multi-billion-dollar facility again announced another reduction in the price of AGO but noted at the time that the change was only applicable to dealers purchasing up to five million litres of diesel and above.
However, it was gathered on Tuesday that the cost of diesel from the plant had increased from the N940/litre price that was announced by the plant in April to a new rate of N1,100/litre. Some other dealers who purchased lesser volumes said they got the product at N1,200/litre.
Oil marketers told PUNCH that the hike in diesel price by the $22bn worth refinery located in Epe, Lagos, was due to the recent southward movement of the naira against the dollar.
“The refinery had earlier reduced the price of its diesel to around N940/litre, but it later increased it up to N1,100/litre. This happened recently, maybe about two weeks ago,” the National President, of the Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi, stated
Providing a reason for this, Maigandi told our correspondent that it “is because of the rising exchange rate, according to what the refinery told us.”
Although officials of the refinery stayed mute when contacted on the matter, industry sources and some major marketers confirmed the development.
“The recent crash of the naira against the dollar is pushing up the cost of commodities and, understandably, the price of diesel from Dangote refinery is being affected,” the National Public Relations Officer, IPMAN, Chief Ukadike Chinedu, stated.
He explained that the Dangote refinery imports crude oil, stressing that crude is priced in dollars.
“So the recent rise in the foreign exchange rate is going to have an impact on the prices of refined products from the plant,” Ukadike stated.
In March and April this year, the naira appreciated against the United States dollar, a development that had marginal positive impacts on the cost of commodities. [PUNCH]
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