Nigeria’s House of Representatives Moves to Investigate Fuel Pricing Row Between Dangote and Regulator

Abuja, Nigeria Nigeria’s House of Representatives has taken decisive action to investigate an escalating dispute between the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and Dangote Refinery over fuel import licences and pricing benchmarks. The move reflects growing concern among lawmakers that mounting tensions in the downstream petroleum sector could threaten fuel security, destabilise the market and undermine investor confidence.

The motion, which was unanimously adopted in plenary, mandates the House’s Petroleum Resources Committees covering both midstream and downstream oversight to conduct a comprehensive inquiry into the matter and report back within four weeks. Speakers at the session emphasised that the investigation aims to resolve regulatory inconsistencies and safeguard Nigeria’s energy infrastructure ahead of the peak holiday demand period.

Core of the Dispute

At the heart of the conflict is a dispute over how licences for the importation of Premium Motor Spirit (PMS) commonly known as petrol are being issued. Dangote Refinery, Africa’s largest crude processing facility, has accused the regulator of granting import licences arbitrarily to market players despite the refinery’s capacity to meet local demand. The refinery argues that Nigeria should rely more heavily on domestically refined petrol, rather than competing with imported fuel that it claims is offered at artificially low prices, undermining local refining operations.

The refinery’s leadership maintains that continuing to allow unrestricted fuel imports erodes its market share and jeopardises its ability to operate sustainably. According to the company, an influx of cheaper imported PMS distorts market pricing, disincentivises domestic production, and risks driving downstream refineries out of business. These allegations have intensified calls for greater accountability and clearer regulatory oversight.

Aliko Dangote’s High-Profile Intervention

Alhaji Aliko Dangote, Nigeria’s wealthiest businessman and head of the Dangote Group, has been outspoken in his criticism of the regulator’s actions. Beyond the parliamentary debate, he has formally petitioned the Independent Corrupt Practices and Other Related Offences Commission (ICPC), demanding a probe into the conduct of the NMDPRA Chief Executive. Dangote’s petition accuses the regulator’s leadership of governance failures and alleged personal financial improprieties, claims which the regulator has denied.

Dangote has argued that Nigeria should be striving to end its reliance on imported fuel by harnessing domestic refining capacity. His refinery designed to process up to 650,000 barrels of crude oil per day was built to reduce foreign exchange outflows, support jobs, and spur industrial growth. However, Dangote contends that regulatory decisions have hampered these objectives by permitting an ongoing volume of fuel imports that outcompete locally refined products.

Lawmakers Warn of Fuel Supply Risks

Members of the House of Representatives have voiced concern that unresolved regulatory friction could trigger a fuel supply crunch, particularly during peak consumption periods such as the year-end holidays. They argue that a fractured policy environment and unclear pricing benchmarks risk creating artificial shortages and price volatility that would hurt consumers and the broader economy.

During plenary, legislators underscored the strategic importance of Dangote Refinery as a national asset capable of transforming Nigeria’s downstream sector. They pointed out that resolving regulatory disagreements is essential to maximising the facility’s potential to stabilise domestic fuel supply, conserve foreign exchange and anchor long-term energy security.

Regulatory Transparency and Pricing Framework Concerns

One of the central issues lawmakers want to address is the perceived lack of transparency in the Premium Motor Spirit pricing mechanism. Critics argue that without clearly defined pricing guidelines tied to production costs, exchange rates and market dynamics, the downstream sector remains vulnerable to arbitrary benchmarks that fail to reflect underlying economic realities.

Calls for transparency extend to how import licences are issued, how pricing assumptions are calculated by the regulator, and whether local refining costs are fairly factored into benchmark prices. Advocates for reform contend that a more predictable and open pricing framework would benefit both producers and consumers, reducing uncertainty in an already volatile market.

Industry and Consumer Implications

The outcome of the House investigation could have far-reaching implications for Nigeria’s petroleum value chain. For industry stakeholders, clarity and regulatory certainty are crucial for long-term investment decisions. Investors are watching closely, as unresolved disputes and policy misalignment could deter capital inflows into critical infrastructure and associated sectors.

For Nigerian consumers, the stakes are equally high. With fuel prices impacting transportation costs and inflation more broadly, any disruption in supply or pricing stability can ripple through the economy, affecting affordability and economic activity in both urban and rural areas.

Next Steps and Broader Outlook

The parliamentary probe is expected to involve hearings with key stakeholders, including representatives from the NMDPRA, officials from the Dangote Refinery, petroleum marketers, and independent experts. Lawmakers have indicated that they will use their constitutional mandate to explore the legal and commercial dimensions of the dispute, while recommending policy adjustments that promote fair competition and national energy priorities.

As Nigeria negotiates the balance between regulatory oversight, investor confidence and domestic refining growth, the unfolding investigation could set a precedent for how the country manages fuel importation, pricing and local production going forward.