The price of gasoline may go below ₦500 per litter. Industry analysts forecast that the price of Premium Motor Spirit (PMS), commonly referred to as gasoline, will drop significantly in 2025, possibly falling below ₦500 per liter. Currently, gas prices at different gas stations range from ₦900 to ₦950 per liter. A strong downstream industry propelled by the Federal Government's deregulation program, steady foreign currency rates, and expanded domestic refining capacity is responsible for the expected price decline.
Important Elements Promoting Price Cuts Enhanced Capacity for Local Refining: It is anticipated that the opening of the Port Harcourt and Warri refineries as well as the Dangote Refinery will increase domestic output and lessen reliance on imports. Seven million gallons of gasoline are presently injected into the domestic market every day by the Dangote Refinery. 1.4 million liters of gasoline are produced daily at the Port Harcourt Refinery, which started operations over a month ago. The primary products of the 60%-capacity Warri Refinery are naphtha, diesel, and kerosene.
Deregulation of the Downstream Sector: As a result of increased producer competitiveness brought about by the deregulation program, prices have decreased. According to industry experts who talked to Saturday Sun, the cost of gasoline, which is currently between ₦900 and ₦950 in many gas stations, might drop even more throughout the year to as low as ₦500 per liter. In an interview with Saturday Sun, Ukadike Chinedu, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), stated that the arrival of several competitors is already encouraging healthy pricing competition.
He pointed out that it is anticipated that the Federal Government's policy of selling crude oil to refineries in return for naira payments will lower inflation and lessen strains on foreign exchange. Chinedu cited the Nigerian National Petroleum Company Limited (NNPCL) and Dangote Refinery's and other key companies' fuel price reductions as proof of the advantages of having a variety of production sources. Modular refineries that currently solely generate diesel are planning to expand their operations to include gasoline refining as a result of better market conditions. Nigeria has 25 licensed modular refineries, five of which are operational at the moment.
As you can see, NNPC has lowered its ex-depot price for marketers from ₦1, 045 per liter to ₦899 per liter, which translates to ₦925 per liter for end customers at the pumps, he stated. I have to say that this is admirable. Massive drops from ₦1, 045 to ₦899 ex-depot are a lot of drops, but these are not little ones. However, he said that the Dangote refinery also lowered the ex-depot price from ₦970 to ₦899.50 per liter. He noted that as long as petroleum products are consistently available, competition will grow and prices will continue to decline in the coming year.
In his opinion, Iche Idoko, the Publicity Secretary of the Crude Oil Refiners Association of Nigeria (CORAN), stated that Nigerians will progressively start to see the benefits, which is common in a deregulated market. "One of the features of deregulation that we had emphasized is the reduction in prices," he stated. There will inevitably be rivalry amongst firms as the industry adjusts to the complete deregulation environment, which will eventually benefit the customers. Prices, product quality, and credit lines for large purchasers will be the main areas of rivalry, he said.