The plan to supply marketers with diesel, Dangote Petroleum Refinery has said Premium Motor Spirit (petrol), and other petroleum products will reduce inflation and generate employment.

According to a statement released by the company on Tuesday, experts praised the move as having the potential to lower inflation, create thousands of jobs, and reduce the cost of petroleum products throughout Nigeria by distributing fuel to manufacturers, telecommunications companies, the aviation industry, and other large-scale users with free logistics support.

This comes as some marketers are worried that if Dangote initiates the scheme, they may lose their employment.

In addition to addressing the nation's long-standing distribution inefficiencies, the refinery stated that its plan to deploy 4,000 new tankers fueled by compressed natural gas (CNG) was anticipated to lessen the impact of middlemen and promote environmental sustainability.

Experts react

According to the Punch report, Dr. Abimbola Oyarinu, a lecturer at the institution, said that if the policy is effectively implemented, it might drastically reduce the power that middlemen hold in the distribution chain for gas and oil.

Oyarinu added that the industry, and occasionally even the state, has historically been held hostage by middlemen, such as tanker drivers.

“This initiative has the potential to dismantle the dominance of powerful middlemen, who have in the past stalled progress and held entities like the NNPCL hostage. However, Nigerians will judge it by its impact on fuel prices. If it leads to cheaper petrol at the pump, it will ease inflation, considering fuel costs and exchange rates are key inflationary drivers in Nigeria,” Oyarinu was quoted as saying.

According to reports, Ibukun Phillips, an energy analyst, called the action "revolutionary" and said it might change Nigeria's energy landscape by making energy more affordable and accessible, particularly in rural regions.

“Logistics currently account for between 10 per cent and 30 per cent of fuel prices. Eliminating this cost will naturally reduce pump prices. Rural dwellers often pay more for fuel than those in urban areas, despite earning less. This initiative could revive disused filling stations and ensure more equitable distribution,” she explained.

With at least 8,000 drivers anticipated to be hired to launch the operation, Phillips claimed the plan would also create jobs.

Additionally, Kelvin Emmanuel, a co-founder of Dairy Hills and an energy specialist, stated that Dangote's decision to pay for logistics was a significant change that would eventually enable Nigerians to benefit from local refining.

He maintained that concerns about the refinery turning into a monopoly are unfounded and instead highlighted structural inefficiencies that have afflicted the industry for many years.

Additionally, he emphasised how fuel delivery has been hindered by "logistical and regulatory failings."

Emmanuel claimed that the Dangote refinery fills long-standing gaps in Nigeria's fuel distribution network.