Nigeria’s petrol market is facing renewed pricing pressure after the estimated landing cost of Premium Motor Spirit (PMS) rose to ₦1,311.36 per litre, widening the gap between import replacement costs and prevailing domestic wholesale prices.
The latest estimate, published in the Major Energy Marketers Association of Nigeria (MEMAN) report, places PMS landing cost at ₦1,311.36/litre as of September 8, compared with a 30-day average of ₦1,216.34/litre. The increase of ₦95.02/litre over the monthly average reflects the sharp rise in international crude and refined-product prices in recent days.
The significance of the latest landing cost becomes clearer when measured against domestic market prices. Dangote Petroleum Refinery’s PMS gantry price remains at ₦1,265/litre, leaving a difference of ₦46.36/litre between imported replacement cost and the refinery’s current price.
The surge in Brent crude above $100 a barrel could also put further pressure on Dangote Petroleum Refinery’s petrol pricing, as higher crude costs raise the replacement cost of refined products. Although the refinery has not announced a new PMS price increase, the widening gap between global crude and product costs increases the likelihood of another upward price review if the crude rally persists.
The same trend is visible across Lagos depots. On September 9, A.A. Rano sold at ₦1,270/litre, Aiteo at ₦1,273/litre, while Ascon, Sahara and Integrated traded at ₦1,279/litre. At these levels, the latest PMS landing cost is between ₦32 and ₦41 per litre higher than prevailing depot prices.
This means the economics of importing PMS have become significantly more expensive than sourcing products from domestic suppliers. In effect, imported petrol arriving at today’s replacement cost would struggle to compete with current ex-depot prices unless international prices moderate or domestic prices adjust upwards.
The rise in landing cost is being driven primarily by developments in the international oil market. Brent crude moved above $100 per barrel on September 9, after MEMAN’s September 8 assessment had used a lower seven-day average of $95.36 per barrel.
This point is critical. The ₦1,311.36/litre landing cost does not fully reflect the latest move in crude prices. If Brent sustains levels above $100 per barrel, the impact is expected to filter into gasoline benchmarks, freight rates and future import-parity calculations.
Freight is also becoming a major factor. Rising tanker rates and higher shipping costs are increasing the cost of moving petroleum cargoes into West Africa which has risen 27% due to the Iran conflict adding another layer of pressure to import economics. For import-dependent supply, higher crude and higher freight translate directly into higher landing costs.
For the domestic market, attention is now turning to Dangote Refinery. The refinery’s ₦1,265/litre PMS price remains below import parity despite the recent rally in crude oil prices and the rise in landing costs. This pricing position has allowed Dangote to retain a competitive advantage over imported products.
The answer will largely depend on the duration of the international oil rally and the pricing strategy of domestic suppliers. If higher crude prices persist and continue to feed into refined-product benchmarks and freight costs, pressure could build for an upward review of PMS prices across the supply chain, including Dangote Refinery and depot prices.
MEMAN’s seven-day average PMS import-parity estimate already stands at ₦1,299.43/litre, indicating that replacement costs have been rising steadily even before Brent crossed the $100 threshold.
As of September 9, the Nigerian market was still trading below import parity, with Dangote at ₦1,265/litre and Lagos depots ranging between ₦1,270 and ₦1,279/litre. The next key market indicator will be whether sustained strength in crude oil prices compels domestic suppliers, particularly Dangote Refinery, to adjust PMS prices upward.