Private Depots Stand Still as Dangote’s Refinery Reshapes Nigeria’s Fuel Market
Private Depots Stand Still as Dangote’s Refinery Reshapes Nigeria’s Fuel Market
Private fuel depots across Nigeria were unusually quiet on Monday as the Dangote Refinery commenced large-scale petrol distribution to retail outlets in at least 12 states, signaling a seismic shift in the nation’s downstream supply chain.
For years, independent marketers and retailers relied on private depots especially in Lagos as their main supply source. But with Dangote offering petrol at ₦820 per litre from its loading gantries, significantly lower than Friday’s depot prices of ₦836 at WOSBAB and AITEO and ₦838 at MENJ, truck operators have quickly rerouted their demand to the refinery.
Industry insiders say the difference, though seemingly small per litre, becomes enormous when multiplied across thousands of litres, making Dangote’s offer hard to ignore. The result was immediate, truck queues vanished from key depots across Lagos.
At Dockyard, AITEO and NIPCO depots were deserted. Along the Satellite Town corridor, MENJ, First Royal, and Rainoil stood idle. Sahara, Bono, and Integrated depots in Coconut saw no truck movement at all. Similar reports emerged from Calabar and Port Harcourt, underscoring the nationwide pull of Dangote’s direct-to-market strategy.
Experts describe the development as a textbook case of market displacement, where a major player leverages price and scale to realign supply dynamics. With its refining and logistics capacity, Dangote appears poised to capture a significant share of the market.
But the transition is not without friction. Unions such as NUPENG and some independent marketers have raised concerns about job losses, disrupted supply chains, and potential monopoly effects. Dangote, reportedly acquiring its own truck fleet to bypass union shutdowns, has heightened tensions further.
Depot owners now face a stark choice, innovate, consolidate, or risk obsolescence. Some analysts suggest strategic alliances or depot repurposing for storage and distribution services may be the only way to remain relevant.
For consumers, the change could mean cheaper pump prices, some marketers already target ₦841 and more consistent availability, potentially saving the country trillions in import costs annually.
Still, critics warn of overdependence on a single supplier and call for regulatory oversight to maintain healthy competition. Supporters argue this is precisely the leap Nigeria needs toward fuel self-sufficiency, given years of NNPC refinery failures.
Whether this marks a permanent transformation or merely the first wave of disruption will depend on how regulators, unions, and competitors respond. For now, Dangote’s refinery has firmly taken center stage in Nigeria’s fuel distribution ecosystem, leaving private depots scrambling to redefine their place in the market.
