Professor Emeritus of Petroleum Economics and energy expert Wumi Iledare said that Dangote backed petrol at MRS filling stations selling at N739 per liter and the long attendance queues are not evidence of market efficiency but of distortions in Nigeria’s oil downstream sector.
He disclosed this in a statement on Tuesday, reacting to the long queues at MRS filling stations in Abuja.
Iledare explained that with fewer than “five MRS stations in the entire Abuja metropolis, isolated price discounts simply manufacture scarcity and long queues.”
He noted that once the time value of money is considered, including hours lost in queues, foregone productivity, vehicle wear and stress, the so-called price advantage quickly evaporates.
Prof. Iledare added that discounted refinery prices only make economic sense if matched by scale in distribution; otherwise, they amount to unsustainable signals that transfer hidden costs to consumers rather than deliver genuine welfare gains.
“What we are witnessing in Abuja, over two thousand vehicles queuing at a single MRS outlet selling Dangote supplied PMS at N734 per liter, is not evidence of market efficiency but of downstream distortion.”
He urged that the Petroleum Authority of Nigeria needs to be vigilant for any anticompetitive behavior in the retail end of the downstream market as well.
DAILY POST reports that he announced a fixed petrol price of N739 per liter for Dangote fuel available at MRS filling stations nationwide.
The move comes after Dangote Refinery reduced its gantry petrol price to N699 per liter to edge out importers and marketers.
DAILY POST also reports that other filling stations, including the Nigerian National Petroleum Company Limited, AA Rano, Mobil, NIPCO, Ranoil, Empire Energy and others, dispense petrol at between N815 and N839 per liter in Abuja.
Why Dangote’s N739/liter petrol price at MRS filling station market distortion – Prof Iledare
