THE major oil marketers have sourced 148,463,142 litres of Premium Motor Spirit, PMS, also known as petrol from the Dangote Petroleum Refinery following increased domestic availability.
The oil marketers, members of the Major Energy Marketers Association of Nigeria (MEMAN), bought the product from the Dangote Refinery within 10 weeks (September 16 and November 24, 2024), averaging 2,120,902 litres per day.
MEMAN members, including 11 Plc, Ardova Plc, Conoil, MRS, NNPCL, and TotalEnergies, account for about 40-50% of Nigeria's petroleum products market share.
Chief Executive Officer of MEMAN, Clement Isong, disclosed the figures at the quarterly webinar in Lagos, yesterday.
Isong, who was represented by Ogechi Nkwoji, Head of Economic Intelligence Research Regulation, said even though MEMAN members got licenses from the Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA, to import petrol, they have resolved to depend on the Dangote Petroleum Refinery.
Isong said that products lifted from the Dangote Petroleum Refinery were transported via trucks and vessels to marketers' facilities in Lagos.
He said that MEMAN members loaded 29,468,333 litres in Week 38 (September 16-22, 2024), followed by 20,843,322 litres in Week 39 and 27,236,283 litres in Week 40.
Isong said: "However, volumes began to decline in subsequent weeks, reaching a low of 1,600,000 litres in Week 46.
"The supply slightly rebounded to 11,596,397 litres by Week 47 (November 18-24, 2024)."
He disclosed that the spot price of petrol based on the 30-day pricing trend from October 10 to November 22, 2024, stands at ₦976.07 per litre, adding that the average price during the same period was ₦971.14 per litre.
He further revealed that the product cost per metric tonne is estimated at ₦708,390, calculated using a foreign exchange rate of ₦1,665.99 to the dollar.
On factors influencing petrol pricing in Nigeria, Isong said the critical cost components include the jetty location, such as ASPM, and a standard product quantity benchmarked at 38,000 metric tonnes.
He said: "The pricing methodology relies on the Argus Gasoline Euro-Bob benchmark for West African deliveries, combined with an average premium.
"The exchange rate is derived from the Central Bank of Nigeria, CBN, weighted average rate within the Nigerian Foreign Exchange Market (NFEM), which significantly impacts the final price."
Isong noted that finance charges contribute heavily to the cost structure, pegged at 32% per annum over a 30-day cycle. Freight costs for Ship-to-Ship, STS operations and related charges reflect a 10-day delivery timeframe to the ASPM jetty, Lagos Midstream Jetty (LMJ) located at the Lagos Apapa Harbour.
"Other local charges include those imposed by the Nigerian Ports Authority (NPA) for services such as towage, berthage, and cargo handling, as well as contributions to NIMASA at 2% of local freight and regulatory fees."
Also, in his presentation - Logistics Challenges and Pricing Trends in Nigeria's Petroleum Industry - Vice President, Crude Oil, Argus Media, James Gooder, identified infrastructure, vessel capacity, and exchange rate stability as the major determinants of petroleum products prices in Nigeria.
He said: "Unfortunately, many of the jetties, particularly in areas like Warri and Calabar, have draft sizes of about five meters, limiting the size of vessels that can dock there.
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"These limitations translate to higher logistics costs, which ultimately affect the pump price of petrol. He pointed out that Investments in improving jetty infrastructure are critical to addressing this bottleneck. If we can deepen these drafts and improve the channels, it will boost business in those areas and accommodate larger vessels.
"This shared approach enhances efficiency and reduces costs, but it's only a partial solution. Addressing structural issues is the long-term answer."
"The landing cost is calculated daily based on the spot price of the product and the prevailing exchange rate."
He said the data from October to November indicated that the exchange rate of the Naira to the Dollar has been relatively stable; adding that with a global decline in crude oil and gasoline prices, the stability has contributed to a reduction in the landed cost of petrol.
He said: "When the FX rate is stable, and the product cost decreases, the landed cost and pump price come down accordingly."
