Less than a month before the highly anticipated launch of Dangote Refinery’s plan to distribute 4,000 Compressed Natural Gas trucks, industry stakeholders are aligning with the refinery’s vision to start direct fuel supply to marketers and key sectors from August 15, according media report.

As of Friday, at least 25 petroleum marketers have signed up for the direct distribution deal with Dangote, a sharp increase from the initial three signatories. This surge indicates growing confidence in the refinery’s logistics and distribution strategy, which aims to enhance fuel availability nationwide.

A senior executive at Dangote Group, speaking anonymously to a journalist on Sunday, confirmed the rapid registration of marketers, noting, “More marketers are registering ahead of the launch. We started with three strategic partners, now we’re at 25.” The refinery plans to leverage its fleet of 4,000 trucks to supply PMS (Premium Motor Spirit) and diesel directly to petroleum marketers, retail outlets, manufacturers, and major industries, including telecommunications and aviation.

This move is seen as a significant disruption to Nigeria’s traditional fuel supply chain, which has long relied on imports and third-party distribution networks. The direct supply initiative is expected to reduce logistical hurdles and potentially lower pump prices, especially in northern Nigeria, while also helping fill the domestic fuel gap. However, it has sparked a debate about market dominance, regulation, and the impact on local competitors.

Market Perspectives and Industry Dynamics

The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, told Sunday PUNCH that marketers feel compelled to cooperate due to the current market realities. “Dangote has become the only supplier of petroleum products in Nigeria and West Africa. We don’t have many options,” he admitted. He added that many marketers are eager to participate in the free distribution scheme, driven by the urgent need to stabilise prices and improve profitability amidst rising costs.

Ukadike also expressed concerns about the long-term sustainability of the current monopoly. “We urge government-owned refineries to increase competition and reduce reliance on a single player. More refineries mean better prices and fair competition for Nigeria,” he said.

Worries Over Job Security Among Tanker Drivers

While many independent marketers are welcoming the refinery’s initiative, there is rising anxiety among tanker drivers over potential job losses. Since Dangote currently supplies a significant share of the country’s fuel, many drivers who operate independently fear that the deployment of Dangote-owned trucks could render their services redundant, leading to widespread unemployment.

The National President of the National Association of Road Transport Owners, Yusuf Othman, confirmed that stakeholders were planning meetings to discuss these concerns. “We’re in discussions, but I can’t disclose specifics yet,” he stated. The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has also warned against expecting too much from Dangote’s scheme, cautioning that such monopolistic moves often lead to temporary relief followed by higher prices, as seen in other sectors like cement and sugar.

Looking Ahead

While the move toward direct distribution appears to be gaining momentum and could revolutionise Nigeria’s fuel supply chain, it is also raising critical questions about market fairness, regulation, and employment. The industry awaits further developments as stakeholders weigh the benefits against the risks, in a landscape eager for greater efficiency but wary of monopolistic pitfalls.