Private Depots Abandoned as Dangote’s Fuel Distribution Takeover

Private Depots Abandoned as Dangote’s Fuel Distribution Takeover

Private fuel depots across Nigeria, particularly in Lagos, stood deserted as Dangote Refinery’s large-scale petrol distribution disrupted traditional supply chains. The refinery, leveraging its 650,000-barrel-per-day capacity, has rerouted marketers and retailers to its facilities, offering petrol at ₦820 per litre—undercutting competitors like WOSBAB (₦836), AITEO (₦836), and MENJ (₦838).The price advantage, though seemingly modest, translates to significant savings over thousands of litres, prompting a swift shift in truck traffic from private depots to Dangote’s loading bays. Depots in Lagos’ Dockyard (AITEO, NIPCO), Satellite Town (MENJ, First Royal, Rainoil), and Coconut (Sahara, Bono, Integrated) reported no truck activity. Similar trends emerged in Calabar and Port Harcourt, underscoring Dangote’s nationwide impact.Industry experts describe this as a textbook case of market displacement, with Dangote’s pricing strategy and massive throughput reshaping ex-depot dynamics. “The refinery’s scale and pricing are squeezing profit margins,” one operator noted, warning that private depots risk obsolescence without innovation or strategic partnerships.Analysts predict that sustained price undercutting could realign supply chains, potentially forcing depot owners to exit or collaborate. For consumers, the shift promises lower fuel prices and more reliable supply, as Dangote’s dominance continues to reshape Nigeria’s downstream sector.  

Source: Private Depots Abandoned as Dangote’s Fuel Distribution Takeover

 - NigerianEye
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