Billionaire businessman says high crude costs, market disruptions and other factors continue to influence pump prices
President of Dangote Group, Aliko Dangote, has explained why petrol prices remain relatively high in Nigeria despite the commencement of large-scale domestic refining, saying local production does not completely shield the market from global crude oil prices and other market pressures.
Dangote spoke during an interview on Arise TV, where he said his refinery purchases crude at prevailing market prices and, at times, pays significant premiums.
According to him, those costs make it difficult to sell refined petroleum products below sustainable market levels.
He also noted that petrol prices in some neighbouring countries remain considerably higher than in Nigeria, a situation he said has contributed to the continued smuggling of petrol across Nigeria’s borders.
‘We Can’t Subsidise Everything’
Dangote disclosed that the refinery had purchased crude oil for as much as $124 per barrel in May, stressing that the cost of crude remains a major factor in determining the price of refined products.
“We can’t go now and subsidise everything,” he said.
He, however, assured Nigerians that the refinery would continue to supply the domestic market, saying there would be no shortage or fuel queues from its end.
Dangote Raises Concern Over Cost of Borrowing
The businessman also identified high interest rates as a major obstacle to Nigeria’s industrialisation drive.
Dangote said it would be difficult to attract and sustain new investments when businesses face borrowing costs of around 30 per cent.
He further warned that without policies that protect productive domestic industries, Nigeria could struggle to attract another major refinery project.
He called for greater policy support for local industries, arguing that stronger domestic production would create jobs, generate taxes and deepen economic activity.
Power, Policy Inconsistency Hamper Manufacturing
Dangote also listed inconsistent government policies and inadequate electricity supply among the challenges confronting manufacturers.
He argued that businesses could not efficiently sustain large-scale manufacturing when they have to depend heavily on diesel for power.
Dangote Speaks on Succession
On succession within the Dangote Group, the businessman said having a male heir was not a priority for him, noting that his three daughters—Halima, Fatima and Mariya—are already involved in the family business.
Dangote said he could see one of his daughters eventually taking a leading role in the conglomerate, adding that all three were capable of contributing to the company’s future.
He stressed, however, that his broader succession plan was focused on ensuring that the company remained professionally managed and maintained strong corporate governance.
‘My Legacy Is to Industrialise Africa’
Dangote said his long-term ambition was to contribute to the industrialisation of Africa by building productive capacity and encouraging other African investors to participate in large-scale ventures.
He said foreign investors were increasingly interested in Africa but needed major investment opportunities capable of attracting substantial capital.
