Concerns are mounting in Nigeria’s downstream petroleum sector as the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has raised fresh allegations against the Dangote Petroleum Refinery. The association claims the refinery’s operational strategy is geared toward monopolising the sector, potentially crippling competition and leading to significant job losses across the country.
In a statement issued by PETROAN’s National Publicity Secretary, Mr. Joseph Obele, the group expressed alarm over the refinery’s forward integration model, which it claims allows the Dangote Group to function not only as a producer but also as a direct distributor thereby cutting out independent marketers and local suppliers.
With a refining capacity of 650,000 barrels per day, the Dangote facility one of Africa’s largest is designed to meet local fuel demand while also exporting surplus products. However, PETROAN insists that such a mega-refinery should be focused on global competition rather than local market dominance.
“Instead of positioning itself for global export competition, Dangote is now acting as a retail operator. This could seriously damage the existing network of filling stations and fuel marketers who can’t compete with its pricing structure,” Obele said.
The association accuses the refinery of adopting a classic market penetration strategy: offering products at artificially low prices to quickly capture market share, with the long-term goal of pushing competitors out. Such a move, PETROAN warns, could force numerous filling stations to shut down, resulting in widespread unemployment.
PETROAN also expressed concern over Dangote’s recent deployment of 4,000 new Compressed Natural Gas (CNG)-powered tankers. While these vehicles promise reduced fuel transportation costs, the marketers argue they could displace thousands of independent truck drivers and owners, further worsening the employment situation.
“Truck owners, filling station operators, and local petroleum product suppliers all stand to lose if this trajectory continues unchecked,” the group stated. “Even small modular refineries and telecom diesel suppliers may be unable to survive the pressure from Dangote’s direct-to-market approach.”
Highlighting the broader economic implications, the group noted that such market dominance could reduce consumer choices, inflate prices in the long run, and weaken economic efficiency.
PETROAN President, Mr. Billy Gillis Harry, has called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Minister of State for Petroleum Resources to intervene. He is urging regulators to implement pricing controls and enforce measures that prevent monopolistic practices.
“Regulatory oversight must ensure that the sector remains competitive,” Harry said. “Our goal is to protect jobs, safeguard consumer interests, and ensure a level playing field for all industry players.”
The association further recommended measures such as strengthening market regulators, guaranteeing crude oil supply to local refineries, and developing programs to mitigate job losses by providing alternative livelihoods for displaced workers.
As the debate over Dangote Refinery’s growing influence intensifies, stakeholders across the sector are calling for swift government action to avert what they describe as a looming crisis in Nigeria’s downstream petroleum industry.
