Aliko Dangote speaks on why his refinery reduced price of diesel

Alhaji Aliko Dangote, the chairman of the Dangote Group, conveyed confidence that the reduction in diesel costs by one-third to N1,200 would lead to a decrease in the inflation rate.

Dangote shared his views with journalists during his Eid-el-Fitr visit to President Bola Tinubu's residence in Lagos.

Dangote emphasised that low diesel prices can actually help to bring inflation down immediately.

It would be recalled that the Dangote Refinery recently commenced the supply of petroleum products, including diesel and aviation fuel to the local market.

Diesel price cut to drive down inflation

Dangote highlighted that his petroleum refinery had been retailing diesel at N1,200 per litre, a considerable decrease from the previous market price range of N1,650-N1,700.

He said: “There’s quite a lot of improvement because if you look at it, one of the major issues that we’ve had was the Naira devaluation that has gone very aggressively up to about N1,900. But right now we’re back to almost N1,250, N1,300, which is a good reprieve.

“Why? Because they’re paying very high prices on diesel and what we did, for example, in our refinery, we started selling diesel at about N1,200 for N1,650 and I’m sure as we go along, things will continue to improve quite a lot."

According to The Nation, Dangote emphasised that low diesel prices can actually help to bring inflation down immediately.

In February, the inflation rate headline surged to 31.70% compared to January 2024's figure of 29.90%, as reported by the National Bureau of Statistics.

Speaking on this, Dangote said he is confident that when the inflation figures are out for the next month, there will be a significant improvement.

Significant improvement in naira value

Additionally, he expressed optimism regarding the economy's trajectory, citing a significant improvement in the naira exchange rate, which had declined from approximately N1,900 per dollar to N1,250-N1,300.

He said: “There’s quite a lot of improvement because if you look at it, one of the major issues that we’ve had was the Naira devaluation that had gone very aggressively up to about N1,900.

“But right now, we’re back to almost N1,250 and N1,300, which is a good reprieve."

Dangote noted that the above developments were already yielding positive outcomes, such as reduced prices for domestically produced commodities like flour, as businesses experienced lowered diesel fuel expenses.