More upturns have continued to evolve in the nation’s downstream petroleum sector since the resumption of petrol lifting at Dangote Refinery I n September.
Analysts say the change to selling Crude to Dangote in Naira cannot work hand-in-hand with being sole off-taker in a sane society.
Observers say NNPC’s withdrawal as the sole off-taker of Dangote petrol marks a significant shift towards complete liberalisation of the market, allowing marketers to source products directly from Dangote Refinery or other suppliers.
With NNPC no longer covering the differential between Dangote’s selling price and the price to marketers, subsidies will cease to exist. Marketers will now buy directly from Dangote and sell at cost price, adding their own differential, which may lead to a hike in the product’s price.
Also, marketers can now source products from anywhere, not just Dangote, promoting competition and potentially stabilising supply chains.
Another key implication of the development is that fuel prices will start to drop considerably but distant cities will continue to pay more after all.
