SEPTEMBER ROLL-OUT: TINUBU PANEL, DANGOTE REFINERY BRAINSTORM ON PETROL PRICING

2. Key Players Involved:
- Federal Government's Committee: Set up to ensure the implementation of crude oil sales in naira and led by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun.
- Dangote Petroleum Refinery: The focal point of the discussions, as it will soon be rolling out petrol.

- Oil Marketers: Concerned about the pricing and logistics of purchasing petrol from the Dangote Refinery.
- Nigerian National Petroleum Company Limited (NNPCL): The sole importer of petrol into the country and currently bearing the subsidy burden.

3. Core Issues Discussed:
- Petrol Pricing: The government and Dangote Refinery are in discussions regarding the pricing of petrol. The concern is that the cost of petrol from the refinery may be higher than current pump prices unless the government intervenes with subsidies.
- Subsidies: The NNPCL has been importing petrol at a loss, selling it at half the landing cost due to government directives. This has resulted in a significant subsidy burden, raising questions about the sustainability of such practices.
- Market Impact: The expected high cost of petrol from Dangote may force the government to make a decision—either subsidize the petrol or allow market pricing, which could lead to higher prices for consumers.

4. Specific Figures and Data:
- Current Petrol Prices: Petrol is currently sold at N600 to N700 per litre, depending on the area.
- Landing Cost: The landing cost of petrol is reported to be around N1,117 per litre, with NNPCL covering a "shortfall" of about N7.8 trillion in the first seven months of 2024.
- Expected Cost from Dangote Refinery: Marketers expect the cost of petrol from Dangote to be close to the landing cost, around N1,200 per litre.

5. Future Considerations:
- Government's Role: The article highlights the potential need for government intervention, either through continued subsidies or allowing market prices to dictate petrol costs.
- Impact on Consumers: If the government decides against subsidies, consumers may face higher petrol prices, which could exacerbate existing economic challenges.

6. Industry Reactions:
- Oil Marketers: Express concerns about the feasibility of purchasing petrol from Dangote if prices remain high and the government does not intervene.
- NNPCL: The company's officials have voiced concerns about the sustainability of the current subsidy burden and the need for a long-term solution.

7. Broader Economic Context:
- Foreign Exchange Challenges: The article mentions the ongoing difficulties in accessing US dollars, which has halted petrol imports by marketers other than NNPCL.
- Compressed Natural Gas (CNG) Initiative: As part of an effort to reduce reliance on petrol subsidies, the government is promoting the use of CNG, though uptake has been slow.