₦airaland Forum

Calitoscassius:
Rubbish! It is still expensive

LegendHero:
What you are seeing in India is more about taxes and other duties.

Below is the breakdown.

Breakdown of Petrol Price in Gujarat (Converted to Naira, ₦)

Taxes (₦705.21 total)
—Excise Duty: ₦363.78 (₹19.90 × 18.27)
—VAT: ₦288.56 (₹15.79 × 18.27)
—Cess: ₦52.87 (₹2.93 × 18.27)

Other Components
—Dealer Price: (₹57.35 × 18.27)
—Dealer Commission: ₦71.06 (₹3.89 × 18.27)

Total Price of Petrol (Retail Selling Price)
₦1,771.25 per liter (₹96.93 × 18.27)

blowjohn:
Point out the loopholes.
Face the message

DemonSlayer:
OK, ignoring all levies and taxes, a base price of ₦1,047.41 is still more than 100% higher than ₦500. I understand that the dealer needs to make a profit by adding their own margin, as well as the retailer, so the actual Refinery Gate Price will give us a clearer picture. Unfortunately, I can't find this data for any specific refinery. Do you have access to any data that could help?

The question we're trying to answer is: What does it cost Dangote to refine 1 liter of PMS? This should determine whether ₦500 can be profitable.

LegendHero:
I am not sure N500 will be profitable for Dangote. Even if he buy the crude in naira for FX stability, I don’t think he can sell for that very low amount.

I am not sure if the data of what it cost Dangote to refine 1 liter of PMS will be available to the public.

DemonSlayer:
I'm similarly inclined, but I haven't seen any conclusive data to confirm this so when people like Westman001 claim pump price should be N500 or less, I wonder how reasonable their claims are.

Nazgul:
How much is the nozzle price. That's the one that concerns us.

richard870:
Ambush pricing to discourage importation by marketers.....petrol price that shouldn't be more than 200 per litre.

If God says Nigeria will get better, it will effortlessly. For now, its simply business as usual with a different 'looting' model in the guise of subsidy removal.... what a pity!

Westman001:
I'm telling you.

You see that price can go below that. Far below but the greedy folks won't flinch.

To me this reduction is just a reaction to guilty conscience.

These folks are making x3 of their supposed profit margin. We see it among small traders in our community they sell what they bought at 200 for 500, 600 even more.

Dangote can still sell it at #500 per litre and he will still profit.

And Nigerians would just be praising them. If NEPA give them light 1 or 2 days. You'll start hearing this NEPA people try o. When it's a steady normal thing in other country or area.

I'm already seeing them saying this is commendable. Great news. Dangote did great

POKUASI2:
200 naira per liter is possible if dollar is doing 1to1 in Nigeria.
Your mindset is the reason Nigeria is where it is today.
Those at helm are not sure whether to run a capitalist or socialist or communist society because your average Nigerian want almost everything for free.

EcomogSoder:
You are 100% right. I just don’t know why some Nigeria are just too greedy I have been buying spaghetti for 1500 in my area for some months now about some days ago I went to the market to buy some other things and I try to buy the spaghetti they said 1100 I now realize the mama blessing as been cheating me imagine making 400 naira profit on top just one spaghetti wen I confronted her she was saying hen transport to go market and come back nko I ask her if nah just one spaghetti she go buy if she go market…. People are just wicked and heartless

Westman001:
Don't do calculations for Dangote. I can beat my chest that he can still sell below that and still make profit. Only if he can be transparent show us the accounting details (which he will never do) then we would know he doesn't push the profit.

Metrofox:
I think you guys are not even factoring the Naira devaluation in your arguments and it is really funny. You think naira is still 200 to a dollar or what? Really funny. If petrol is sold for 400 naira or even 500 naira convert to dollar and compare with global production price

Westman001:
You understand.

And @ LegendHero, Metrofox, DemonSlayer. That responded to my comment. My question for is, "Do you have all the data"

I gave my response on what we all experience in our various communities, how folks make above profit margin. Something that would be 70 they will close it to 100 because they don't want to be stressing theirself for change. If these people do beyond margin like that what gave you the assurance that top people don't do that.

Don't do calculations for Dangote. I can beat my chest that he can still sell below that and still make profit. Only if he can be transparent show us the accounting details (which he will never do) then we would know he doesn't push the profit.

Hypo sachet and some other items used to put price tag on their products. They know what the profit margin is, if one sell it at the tagged price profit would still be achieved . But no...

Nigeria and Nigerians have never looked within. The comparison DemonSlayer gave is totally irrelevant. That is India. This is Nigeria.

We have to look within and use our strength from there. The Nigerian government and most citizens love to do comparison on a negative aspect.

LegendHero:
I also agree he can still sell below for profit. When he first started diesel too, he keep beating the price down from his intial price.

However, selling for N500 will be an overkill. Without subsidy, I doubt he will make any profit selling at that low rate. Most countries that sell lower are heavily subsidizing the industry.

Standardized general cost of refining a liter put it within $0.4 to $0.7 range worldwide. Let's now say Dangote is using the lowest cost of $0.4, that is still over N600. So how exactly did you guys arrive at N500 figure?

Westman001:
I understand you.

But if you check it again you still hear the government saying subsidy is still going on within. You must have hear it.

I and my boss had a meeting with one of the directors at FMdQ earlier this year ad the man mentioned that subsidy ain't gon.

You see this country is a shit hole. My eyes was opened and I stopped defending this country a long time ago.

We need more than George Washington to set this country right

DemonSlayer:
My brother, I'd be the happiest person if PMS sells for under N500. I agree with you about the human tendency to maximize profits and to take it too far. It's not just a Nigerian thing; it's ingrained in the human spirit, only curtailed by market forces or policy interventions.

However, in pointing this out, let's not make hasty conclusions that could be misleading. There's no benefit in vilifying a business or individual unjustly—especially one that has achieved what none other has achieved in the country and infuses the sector with much needed competition.

That said, I'm not absolving Dangote of anything. I'm simply asking, in the interest of knowledge and to set the facts straight, that you explain how it's possible for Dangote, or any refinery, to sell at the price you mentioned. A man who makes a claim should substantiate it, I'm sure you're aware that burden of proof is on the one who makes a claim. It would be very enlightening if you could spell out how this stunt can be pulled off in concrete terms. I'm open-minded and keen to learn from you.

Regarding the Indian market situation, I brought it up as a backdrop to better understand what's achievable in a similar market, not to serve as a definitive model for us.

Westman001:
Like you response.

You got my points. It's human ingrained and a reasonably working country can curtail that with good policy intervention and implementation.

None of us can spell it out except you work at the finance Department of Dangote Petrochemicals.

Intention of my comment is not to villify Dangote. It's a general understanding of our society. And only transparency can give peace on that side which many companies is very scared to give, transparency.

Jorussia:
Tinubu didn't remove pms subsidy.There was no provision for it in the budget of 2023.There was nothing he did at inauguration that was bad.Infact, if he had not make that announcement on that day,i can assure there wouldnt have dangote and PH refinery in operation today.The problem of the high energy price today has nothing to do with the removal of pms subsidy,its a failure of the fx rate.If fx is #700 today,pms can't sell for more than #420 in any part of the country.

The Economic policy of this administration that is currently failing is the management of fx.May be when they finally hit 2m barrels of crude oil per day sometime around March next year,the government may decide to defend the naira.#1500 fx does not have any benefit for Nigeria and Nigerians.Any fx more than #700 is going erode any imaginary economic gains.

goldenmind:
This is why I welcome this Dangote Refinery... Let competition in the price of PMS begin.. I swear 2025 gonna be interesting on top PMS..

tisriley:
Commendable

efemena5050:
People always trying so hard to sound intelligent but seriously u always find loopholes due thier lack of objectivism....na wa ooo

richard870:
Lol. Its obvious my comment is way beyond the capabilities of your IQ

richard870:
Ambush pricing to discourage importation by marketers.....petrol price that shouldn't be more than 200 per litre.

If God says Nigeria will get better, it will effortlessly. For now, its simply business as usual with a different 'looting' model in the guise of subsidy removal.... what a pity!

richard870:
Ambush pricing to discourage importation by marketers.....petrol price that shouldn't be more than 200 per litre.

If God says Nigeria will get better, it will effortlessly. For now, its simply business as usual with a different 'looting' model in the guise of subsidy removal.... what a pity!

POKUASI2:
Doubt you even have a functional brain cells for starters because you if you, you wouldn't dare post a comment like that.
You're mentally degraded hence why you'd feel the need to post that nonsense that come across like you no get sense

richard870:
Ambush pricing to discourage importation by marketers.....petrol price that shouldn't be more than 200 per litre.

If God says Nigeria will get better, it will effortlessly. For now, its simply business as usual with a different 'looting' model in the guise of subsidy removal.... what a pity!