Independent petroleum marketers have rejected Dangote Petroleum Refinery‘s decision to begin pricing petroleum products in United States dollars, warning that the move could put fresh pressure on Nigeria’s foreign exchange market and lead to higher fuel prices.

The latest development follows the refinery’s announcement that Premium Motor Spirit (petrol), Automotive Gas Oil (diesel) and aviation fuel supplied through its gantry and coastal channels would now be priced in dollars, replacing the previous naira-based payment structure.

In a notice to customers, the refinery said all previously issued payment documents denominated in naira had become invalid following the transition to dollar pricing.

The decision has already begun to ripple across the downstream sector, with private depot owners adjusting loading prices as marketers factor higher replacement costs into their operations. Data from petroleumprice.ng showed petrol prices increased by as much as ₦113 per litre at some depots, while diesel prices also recorded significant increases in parts of Lagos, Port Harcourt and Warri.

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) described the policy as a worrying development that could gradually encourage the dollarisation of domestic fuel transactions.

Its National President, Billy Gillis-Harry, acknowledged Dangote Refinery’s contribution to Nigeria’s energy security but argued that decisions affecting a product consumed locally should also consider their wider economic impact.

“This will turn Nigeria into a dollarised economy,” Gillis-Harry said, adding that marketers purchasing products in dollars would eventually face pressure to pass those costs on to consumers.

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He urged the Nigerian National Petroleum Company (NNPC) Limited to improve operations at the country’s state-owned refineries to encourage competition and reduce dependence on a single supplier.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) also called on President Bola Tinubu to intervene by sustaining the crude-for-naira arrangement introduced to support domestic refining.

National Publicity Secretary of the association, Chinedu Ukadike, warned that pricing locally refined fuel in dollars could increase demand for scarce foreign exchange and further expose Nigerians to pump price volatility.

“The sale of fuel in dollars will ultimately affect prices at the pump,” he said, noting that exchange rates and global crude oil prices remain the biggest factors determining the cost of petrol in Nigeria’s deregulated market.

Dangote Refinery’s latest pricing model has reopened debate over the future of the crude-for-naira initiative, which was designed to reduce pressure on foreign exchange by allowing domestic refiners to purchase crude oil in naira.

While marketers insist the arrangement should continue, energy experts remain divided over the refinery’s decision.

Petroleum economist and Professor Emeritus Wumi Iledare argued that the move reflects commercial realities rather than an attempt to dictate market prices. According to him, because crude oil and several refinery inputs are largely dollar-denominated, pricing products in dollars helps reduce foreign exchange risks.

He maintained that publishing a selling price does not amount to price fixing in a deregulated market, where competition ultimately determines whether buyers accept the price.

However, energy law expert and University of Lagos professor Dayo Ayoade disagreed, arguing that petroleum products sold within Nigeria should ordinarily be transacted in naira, the country’s legal tender.

Although he acknowledged the refinery’s need to protect itself against exchange rate losses, he questioned whether the policy was appropriate, given the support the project received from the Nigerian financial system. He also called on regulators, including the Central Bank of Nigeria and the Nigerian Midstream and Downstream Petroleum Regulatory Authority, to review the decision.

The controversy comes as Dangote Refinery continues to reshape Nigeria’s fuel supply chain by reducing dependence on imported petroleum products. However, its latest pricing policy has shifted attention from refining capacity to the broader question of how domestic petroleum products should be priced in a deregulated market.

With marketers pushing for government intervention and experts offering contrasting views, the debate is likely to influence discussions around market competition, consumer protection and the future of the crude-for-naira policy in Nigeria’s downstream petroleum sector.

Meiza Nigeria