Conflict in the Middle East sparks Dangote's decision to increase fuel costs to N1,245 per litre

Dangote Petroleum Refinery has unveiled a new price hike for Premium Motor Spirit (PMS), driven by intensifying global geopolitical tensions and soaring crude oil costs, which have led to a surge in prices.

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The refinery's ex-depot price is set to rise from N1,175 to N1,245 per litre, while the coastal price will increase from N1,512,648 to N1,606,518 per metric tonne, according to a notice sent to petroleum marketers on Friday.

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The revised pricing structure is scheduled to take effect from midnight on March 21, 2026, and reflects the current global market conditions, including crude oil price fluctuations and higher shipping costs.

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Marketers who have existing supply arrangements in place, backed by valid bank guarantees, will still be able to lift products at the previous rates, provided their guarantees cover the price difference, as outlined in the notice.

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The refinery will debit the corresponding cost difference to marketers' trading accounts, with payment evidence required by March 23, as the new pricing system is implemented.

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Industry analysts anticipate that the price increase will lead to higher pump prices across the country, as marketers are likely to pass on the additional cost to consumers, affecting the overall fuel supply.

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Despite the potential of the Dangote refinery to stabilise Nigeria's fuel supply, the market remains highly sensitive to international price movements, which can have a significant impact on the local economy.

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The price hike occurs amidst ongoing tensions in key oil-producing regions, particularly the Middle East, which have driven up crude prices and freight costs, affecting the global energy market.

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Nigerian households and businesses are expected to feel the impact of the adjustment in the coming weeks, as it affects transportation and goods pricing, leading to potential economic implications.