Major Fuel Buyers Turn to Dangote Refinery for Direct Purchases

Bulk fuel buyers and filling stations are increasingly bypassing middlemen as Dangote Refinery begins its direct fuel distribution scheme with free delivery to end users.

The President of the National Association of Road Transport Owners (NARTO), Yusuf Othman, raised concerns during a live programme on TVC News. He criticised the move, noting that many buyers had abandoned existing contracts with his members in favour of Dangote’s free delivery service.

Othman explained that NARTO members operate about 30,000 trucks and cannot compete with free distribution. He warned that agreements signed with companies—some of which were used to secure bank loans for trucks—were now being undermined.

“Agreements we signed with companies are being jeopardised because a bigger player has decided to supply directly, ignoring the contracts already in place. If I have 10 trucks serving a client under an agreement, and another party offers the same service for free, it places us in a very difficult position,” Othman said.

He added that members were alarmed as their trucks risk being sidelined. He urged the Federal Government, particularly the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), to step in, pointing to provisions in the Petroleum Industry Act that could classify the practice as unlawful.

Although Othman later declined further comments, saying discussions were underway for possible negotiations, the impact of the new scheme is already visible. Previously, middlemen bought from refineries or depots before reselling to bulk users. The new Dangote arrangement, however, allows buyers to register directly and cut costs.

The logistics-free distribution system was officially launched last Monday, with over 1,000 compressed natural gas-powered trucks slated for deployment to Lagos, Ogun, Ondo, Oyo, Osun, Ekiti, Edo, Delta, Rivers, Kwara, and Abuja.

The rollout also came with reduced pump prices. Fuel is expected to sell at ₦841 per litre in Lagos and other South-West states, and ₦851 per litre in Abuja, Rivers, Delta, Edo, and Kwara.

In a statement, Dangote Group confirmed that the first phase of deployment would focus on the Federal Capital Territory, Lagos, Kwara, Delta, Edo, Rivers, and the South-West, with nationwide expansion to follow.

Marketers have already confirmed receiving deliveries. The National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Abubakar Shettima, said Dangote’s CNG-powered trucks had begun discharging products in Lagos, Ondo, Ogun, and Ibadan.

“My members are pleased with the development. Deliveries are ongoing, especially in the Western Zone, and prices will drop from ₦865 to ₦841 once the products arrive at the stations,” Shettima stated.