Business
INVESTIGATIVE REPORT: Does Dangote Refinery Have Genuine Grounds to Raise Petrol Prices to N995/litre?
INVESTIGATIVE REPORT: Does Dangote Refinery Have Genuine Grounds to Raise Petrol Prices to N995/litre?
By Oghenewoke Onoriode | Waterways News Research Reporter| March 7, 2026
THE CENTRAL QUESTION
The Dangote Petroleum Refinery’s justification for a N221 price hike within four days rests on one foundational claim: that it sources crude at international market prices and is therefore exposed to global oil price shocks. Our investigation finds this claim to be substantially true — but also structurally problematic, and one that raises serious questions about Nigeria’s energy policy failures, not just the refinery’s pricing decisions.
FINDING 1: THE REFINERY IS NOT PURELY DOMESTIC IN ITS CRUDE SOURCING — FAR FROM IT
This is perhaps the most critical finding of this investigation, and one the refinery does not loudly advertise in its public statements.
Dangote Refinery currently receives only five crude oil cargoes per month from NNPC — less than half of the 13 it needs to sustain full domestic supply. The shortfall of eight cargoes is sourced from other suppliers outside the country.
The scale of this foreign dependence is staggering. In 2025, the refinery bought approximately one-third of its crude from the United States, the lion’s share being West Texas Intermediate (WTI) Midland — sourced from crude fields around Midland, Texas, roughly 6,500 miles away.
“By mid-to-late 2025, U.S. crude had come to dominate the refinery’s feedstock mix for an extended period spanning several months, consistently outpacing Nigerian grades as the primary source of crude supply to the facility.”
In other words, this is not a local refinery sourcing local crude in any meaningful or sufficient sense. A refinery importing the majority of its feedstock from Texas and the Middle East, and paying for it in U.S. dollars at international market rates, is — by every economic measure — as exposed to global crude price shocks as any importer of finished petroleum products.
FINDING 2: EVEN THE NIGERIAN CRUDE IT BUYS IS PRICED AT INTERNATIONAL RATES — PLUS A PREMIUM
This is where the story gets even more complex. One might assume that the five monthly NNPC cargoes Dangote does receive are priced at a discounted or locally negotiated naira rate. They are not.
The cargoes received from NNPC under the naira-for-crude arrangement are priced at international market rates plus a premium. Nigerian crude oil costs $3 to $6 more per barrel above the Brent benchmark price. After adding freight of $3.50 per barrel, crude lands in Dangote’s tanks at between $88 and $91 per barrel.
For the additional eight cargoes sourced internationally, the refinery procures foreign exchange at open market rates to pay for crude purchased from local and international traders. Nigeria’s upstream producers have also failed to supply crude to the refinery as required under the Petroleum Industry Act (PIA), forcing the company to source a substantial portion through international traders who charge an additional premium.
This means there is essentially no subsidized or preferential pricing for Dangote despite the refinery being on Nigerian soil. Every barrel it processes costs it close to or above the full international market rate.
FINDING 3: THE NNPC’S SYSTEMIC FAILURE IS A ROOT CAUSE THE PUBLIC IS NOT BEING TOLD CLEARLY ENOUGH
NNPC has an economic incentive to sell its crude oil on international markets rather than to Dangote, because revenue from crude sales to the refinery is denominated in naira — a currency that has weakened relative to the U.S. dollar. NNPC’s ability to increase deliveries is also limited because crude oil production by NNPC and its partners has generally declined, falling from a peak of 2.4 million barrels per day in 2005 to 1.3 million barrels per day in 2024.
NNPC has committed much of its output to service deals with financial lenders, leaving the refinery to import crude from countries like the US and the Middle East.
This is the central structural irony: Nigeria is Africa’s largest oil producer, yet its flagship domestic refinery cannot get adequate Nigerian crude. The NNPC has pledged future oil production to international creditors, leaving Dangote to compete on the open international market like any other buyer — paying full dollar prices.
FINDING 4: ON THE SPECIFIC PRICE HIKE — THE NUMBERS ARE PARTIALLY JUSTIFIED, BUT ALSO PARTIALLY QUESTIONABLE
The refinery’s price increase is tied to a genuine surge in global Brent crude prices driven by Middle East conflict. Benchmark Brent prices rose by about 26% within a short period to above $84.0 per barrel. The refinery implemented a price adjustment of N100 per litre and says it has absorbed 20% of the total cost escalation to cushion the domestic market.
However, a sharp contradiction emerged simultaneously. Data from the Major Energies Marketers Association of Nigeria (MEMAN) showed that the landing cost of imported petrol stood at N809.37 per litre, about N64 cheaper than Dangote Refinery’s N874 per litre gantry price — and that was before the refinery added another N121 to reach N995.
This data point is damning. If imported petrol — which must cross oceans, pay shipping costs, and clear Nigerian ports — still lands cheaper than Dangote’s gantry price, it suggests the refinery’s cost pass-through to consumers may include more than just raw crude and freight costs. It may also include capital recovery costs on a $20 billion investment, operational inefficiencies, and margin protection.
FINDING 5: THE REFINERY IS SIMULTANEOUSLY EXPORTING, EVEN AS IT RAISES DOMESTIC PRICES
Since starting operations, the refinery’s supply has found its way into growing international markets including neighboring African countries, the Middle East, and Southeast Asia — and in 2025, it made its first petrol shipment to the United States.
The fact that the refinery is exporting product to international markets while simultaneously raising prices for Nigerian consumers and citing global cost pressures deserves scrutiny. While the refinery has the commercial right to operate this way under deregulation, Nigerians are right to ask whether “prioritizing the domestic market” — a phrase Dangote’s management uses frequently — is fully consistent with active export operations during a period of domestic price surges.
EDITORIAL VERDICT: PARTIALLY JUSTIFIED, BUT STRUCTURALLY BROKEN
The price increase has genuine economic grounding, but it exposes a much larger failure of Nigerian energy policy.
Dangote’s core argument — that it is exposed to international crude prices — is verified and accurate. The refinery is not, in any practical sense, a purely domestic crude processor. It sources the majority of its crude internationally, pays dollar prices, and operates in a fully deregulated market. Under those conditions, global price shocks will always pass through to Nigerian consumers.
However, several uncomfortable truths also stand:
– The promise that a domestic refinery would insulate Nigeria from global fuel price volatility has not materialized, because NNPC has failed to supply adequate local crude at preferential rates.
– Imported petrol is currently landing cheaper than Dangote’s product, which undermines the narrative that local refining is always cheaper for Nigerians.
– The Nigerian state — through NNPC’s failures, the naira’s weakness, and the PIA’s unimplemented crude supply obligations — is largely responsible for the structural conditions forcing Dangote to this price level.
– And critically: Nigerians are being asked to absorb international crude price shocks from a refinery they were told would end exactly that dependency.
The price hike is not fraudulent. But it is a symptom of a broken system — one that Dangote did not create, but which he now benefits from commercially, and which the Nigerian government has shown little urgency to fix.
AS SAUDI TANKERS DITCH RED SEA FOR AFRICA ROUTE, NIGERIA IS MISSING FROM THE MAP
By Oghenewoke Osaweren | Waterways News
Six Saudi supertankers turned their backs on the Bab el-Mandeb chokepoint this week, setting a course around the entire African continent rather than risk the Houthi-threatened waters of the Red Sea. The vessels are heading toward Gibraltar and South Africa’s Durban and Algoa Bay ports as waypoints on their unusual cross-continental journey. All six had loaded no cargo and turned away from Bab el-Mandeb after Houthi attacks on Saudi-linked shipping pushed Riyadh to reroute crude exports through Egypt instead.
It is a story that has run in Bloomberg, Reuters and half a dozen shipping trade outlets already, told mostly from the bridge of the tanker and the trading desks of Riyadh and London. What almost none of them ask is the question that matters most from Lagos: as six more supertankers join a growing armada now circling Africa’s coastline every month, why is Nigeria still standing outside looking in?
A DETOUR THAT IS BECOMING THE ROUTE
This is no longer a short-term scramble. Cape Town alone has seen a 112 percent surge in vessel traffic as the southern route hardens from an emergency workaround into what analysts now call a structural feature of global shipping. A single VLCC or large container ship now absorbs between $400,000 and $800,000 in extra bunker costs per voyage just to make the longer trip. That is money looking for somewhere on the African coast to land.
South Africa’s own commentators have begun asking why the country is watching billions of dollars in shipping activity sail past its shores while the fuel, repair, warehousing and crew-change business goes elsewhere. Namibia is expanding Walvis Bay, Kenya is pushing Lamu Port, and even Togo has moved to turn the Port of Lomé into a bunkering and transshipment hub, while South Africa’s own bunker volumes fell from roughly 130,000 tonnes a month to about 80,000. Mauritius nearly doubled its bunker fuel sales at Port Louis to a record 929,043 metric tons in 2024, up from 509,837 tons the year before, as regulatory friction pushed business away from South Africa.
Nigeria appears nowhere in that list of contenders despite being the continent’s largest crude producer, sitting directly along the Atlantic leg of the same route these tankers must sail to reach Gibraltar and the Mediterranean.
THE COAST NIGERIA IS NOT SELLING
Every vessel diverted around Africa eventually has to pass along West Africa’s flank on its way north. That ought to be an opportunity for Nigerian ports, bunkering, ship supply, crew changes and repair contracts to have the same economic multiplier effect that analysts say is now reshaping port economies from Cape Town to Lomé. Instead, the conversation happening in Abuja, at NIMASA, and inside Nigeria’s port authorities has been almost entirely absent from the continental race to capture this windfall.
The silence is not free. The Gulf of Guinea already accounted for 92 percent of all crew kidnappings worldwide in 2025, with the number of crew taken hostage rising from 12 in 2024 to 23. Niger Delta-based pirate networks have shown growing operational sophistication and a readiness to use violence to secure ransom, with oil tankers and offshore support vessels remaining their primary targets. As more traffic funnels past Nigerian waters on the long haul to Europe, that threat does not shrink — it grows, and it grows against a security posture that has not visibly scaled to match it.
GOVERNANCE, NOT GEOGRAPHY, IS THE GAP
Industry voices in South Africa have already diagnosed their own version of this failure in stark terms, is insisting the issue is not geography but execution: infrastructure, regulation, and the will to compete for business that is, quite literally, passing offshore. Where shipping lines seek alternatives to traditional routes, that opens opportunities for local ports, logistics operators, ship repair facilities, bunkering providers and maritime security operators to grow.
That same test now sits in front of Nigeria. The Saudi tankers steaming past this week are not a one-off curiosity. They are six more data points in a shift that has already rewritten shipping economics for the whole continent. The trip round Africa adds roughly ten days and demands more fuel and crew time, driving up costs for every operator making the journey. Every one of those extra days is revenue waiting for a coastline willing to organize itself to collect it, a test Nigeria’s maritime institutions have yet to show up for.
Blue Economy
Lekki Port Lands HMM-ONE Alliance Service, Boosts Nigeria’s Direct Global Shipping Links
Lekki Port Lands HMM-ONE Alliance Service, Boosts Nigeria’s Direct Global Shipping Links
By Raymond Gold | Waterways News
Lekki Deep Sea Port has notched another milestone in its bid to establish itself as West Africa’s premier maritime gateway, welcoming the maiden call of a new joint container service operated by Hyundai Merchant Marine (HMM) and Ocean Network Express (ONE).
The port received the inaugural vessel under the newly launched Mediterranean West Africa Service (MA2) on Saturday, July 25, 2026, adding another direct link between the Nigerian deep seaport and major hubs across Europe and West Africa.
Port management says the new rotation should translate into more frequent direct vessel calls, quicker cargo evacuation, and a stronger competitive position for Nigeria in regional and international trade.
Lekki Port Managing Director Wang Qiang called the maiden call a strong vote of confidence in the facility’s infrastructure and operational efficiency, noting that international carriers’ willingness to route through Lekki reflects growing trust in the port’s capacity to handle major liner traffic.
He said the addition to the MA2 rotation opens up new trade opportunities for shippers and reinforces Lekki’s ambition of becoming West Africa’s leading logistics gateway.
Industry watchers expect the service to give Nigerian importers and exporters more scheduling flexibility and more predictable transit times, while easing some of the bottlenecks that have historically dogged cargo movement between Nigeria and European markets. Manufacturers and agricultural exporters in particular stand to benefit from steadier access to overseas buyers through a regular liner rotation.
Since opening for commercial business, Lekki Deep Sea Port has drawn a growing roster of global shipping lines, banking on its deep draught, modern handling equipment, and faster turnaround times to differentiate itself from Nigeria’s older, more congested terminals.
Nigeria Watch
The HMM-ONE call is worth reading against the backdrop of what Lekki was built to fix. For decades, Nigerian cargo bound for Europe routed through transshipment hubs like Tema, Cotonou, or even ports further afield, adding cost, time, and risk that Apapa and Tin Can Island’s chronic gridlock only made worse. A direct alliance service naming Lekki in its West Africa rotation is a signal that at least one deep seaport in the country can compete on draught, turnaround, and predictability, all terms that matter to carriers.
But one alliance call does not settle the larger argument. Nigeria’s port sector still carries structural drag, the NPA’s stalled $1 billion modernisation ambitions for the older Lagos terminals, unresolved concession renewal anxieties among existing operators, and an Electronic Call-Up System that has yet to fully tame the Apapa corridor. If Lekki’s gains simply widen the gap with legacy terminals rather than pulling the whole system up, the win will be lopsided, one gateway thriving while NPA-controlled ports continue to bleed time and money to congestion.
There is a policy question the Federal Ministry of Marine and Blue Economy and NIMASA need to keep asking. Is Nigeria converting improved shipping access into real export growth, or just cheaper imports?
A liner service is only as valuable as what moves through it in both directions. Unless agricultural and manufactured exporters actually scale up shipments through Lekki, the “improved global connectivity” story risks being another headline that doesn’t reach the balance of trade.
Business
Lagos Ports Choke Point: NPA Logs 16 Ships Waiting to Berth, Braces for 28 More Arrivals in Five Days
Lagos Ports Choke Point: NPA Logs 16 Ships Waiting to Berth, Braces for 28 More Arrivals in Five Days
By Raymond Gold | Waterways News
Nigeria’s Lagos ports are staring down another week of heavy vessel traffic, as the Nigerian Ports Authority (NPA) confirmed that 16 ships are currently anchored off Lekki Deep Sea Port, Tin Can Island Port and Apapa Port awaiting berthing space, with 28 additional vessels expected to arrive between July 22 and July 26. The disclosure was contained in the NPA’s daily Shipping Position released on Wednesday in Lagos, a routine bulletin that nonetheless offers a revealing snapshot of just how dependent Nigeria’s busiest port complex remains on imported fuel, food and industrial raw materials.
According to the authority, the vessels currently waiting to discharge are carrying a mixed manifest of petrol, aviation fuel and diesel alongside bulk wheat, bulk fertiliser, bulk urea and bulk sugar, plus general cargo. It is a cargo profile that has become familiar at Nigerian ports: fuel and food, arriving in near-equal measure, queued up behind one another for scarce berthing windows.
The pressure is not expected to ease soon. The NPA said the 28 vessels billed to arrive over the coming days are loaded with bulk wheat, containerised cargo, fresh fish, petrol, trucks, fuel oil, diesel, crude oil, aviation fuel and general cargo, a schedule that, added to the ships already waiting, will keep berths at Apapa, Tin Can and Lekki under sustained strain through the weekend.
Meanwhile, port operations have not stalled. The authority reported that 21 ships are actively discharging cargo across the three terminals, offloading containers, petrol, aviation fuel, crude oil, bulk fertiliser, bulk gypsum, gas, diesel, bulk wheat, bulk sugar, bulk urea, fresh fish, general cargo and base oil, evidence that, congestion notwithstanding, throughput at Nigeria’s premier gateway ports continues at pace.
Perhaps the most striking element of the report is what it says about Nigeria’s fuel import dependence. Despite the ramp-up in domestic refining capacity since the Dangote Petroleum Refinery came on stream, a significant share of the vessels at anchor or inbound are still laden with premium motor spirit, automotive gas oil, aviation fuel and fuel oil. It is a reminder that local refining, however much ground it has gained, has not yet closed the gap between what Nigeria produces and what it consumes at the pump.
Taken together, the numbers point to a port system running close to capacity, fuel tankers, bulk carriers and container ships jostling for a limited number of berths, even as crude oil exports and refined product imports continue to move in parallel through the same gateway.
Nigeria Watch
For a country whose ports serve as the primary conduit for both its oil export earnings and its fuel security, a queue of 16 ships waiting to berth, with 28 more converging on Lagos within days, is not merely a logistics footnote. It is a live pressure test of infrastructure that has long struggled to keep pace with cargo volumes at Apapa and Tin Can Island in particular, both of which remain hemmed in by shallow drafts, ageing quay aprons and access-road gridlock that regularly spills into the Apapa-Oshodi corridor.
The persistence of large petrol, diesel and aviation fuel cargoes on the manifest, well over a year after Dangote Refinery began supplying the domestic market, is the detail industry watchers should sit with longest. It suggests that the substitution of imported refined products with local output remains partial, and that Nigeria’s downstream fuel security still rests substantially on seaborne imports arriving through Lagos. That dependence carries fresh weight given the unfolding Strait of Hormuz crisis, where rising war risk insurance premiums, seafarer deployment restrictions from source countries like India and the Philippines, and tighter tanker availability are already pushing up freight costs on routes serving West Africa. Any prolongation of that crisis would be felt first at berths exactly like these, where PMS and AGO cargoes queue for discharge.
There is also a capacity argument buried in this traffic report that reinforces the case for Lekki Deep Sea Port to absorb a larger share of Lagos-bound cargo, easing pressure on the constrained, decades-old infrastructure at Apapa and Tin Can. With concession renewal talks at both older terminals still unresolved, and the Nigerian Ports Authority yet to deliver the kind of berth-productivity gains that would meaningfully cut turnaround times, congestion of this scale is likely to remain a recurring feature of the Lagos shipping position rather than an isolated week’s anomaly. For Nigerian shippers, freight forwarders and importers already contending with elevated global freight rates, that is a cost that ultimately lands on the consumer.
Source: NPA
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