The Dangote Petroleum Refinery has increased the price of diesel, from N940/litre to N1,100/litre due to the recent decline in the value of the Nigerian naira against the US dollar.
Recall on April 24, 2024, it was reported that the Dangote refinery had announced a reduction in diesel and aviation fuel prices to N940/litre and N980/litre.
Earlier, on April 17, the refinery reduced the cost of diesel from N1,200/litre to N1,000/litre in response to oil marketers' requests.
However, it was gathered on Tuesday that the cost of diesel from the plant had increased to N1,100/litre, with some dealers purchasing smaller volumes getting the product at N1,200/litre.
Oil marketers attributed the hike in diesel price by the $22bn worth refinery located in Epe, Lagos, to the recent depreciation of the naira against the dollar.
In March and April this year, the naira appreciated against dollar, leading to marginal positive impacts on the cost of commodities. However, the improvement in the naira could not be sustained, as the local currency came crashing against the dollar in subsequent weeks.
The naira has traded above N1,400/$ for most of May, with operators revealing that they bought the dollar at N1,400 and sold at N1,425 per dollar, leaving a profit margin of N25.
The Dangote refinery imports a large portion of its crude, and the commodity is priced in dollars. It was reported last week that the refinery was seeking to purchase millions of barrels of US crude oil over the next year as it ramps up processing rates.
Bloomberg reported that the plant had issued a term tender for the purchase of two million barrels a month of West Texas Intermediate Midland crude for 12 months starting in July.
