Why Marketers Are Buying Dangote Fuel Through Lomé Instead of Nigeria

Nigeria’s fuel market is facing a strange but important shift.

Some petroleum products being recorded as imports may not be foreign-refined fuel in the usual sense. They may actually be products refined by Dangote in Nigeria, shipped to Lomé in Togo, and later brought back into the country.

The main reason is pricing arbitrage.

In simple terms, marketers follow the route that gives them the best margin. If buying through the Lomé trading hub gives them a better commercial advantage than buying directly from Dangote’s refinery gate in Nigeria, they will use that route.

This means a product can be refined in Nigeria, exported to Lomé, priced within the regional market, and then re-imported into Nigeria.

So the issue is not just about fuel leaving and returning. It is about how pricing, logistics and market incentives shape the movement of petroleum products across West Africa.

Why marketers are using the Lomé route

The major reason is price.

Dangote sells into the domestic Nigerian market at one price. But once the product is exported to Lomé, it enters a wider regional trading pool.

At that point, the product is no longer tied strictly to Dangote’s domestic price. It begins to trade around the Lomé benchmark, which is influenced by regional demand, international prices, supply conditions and shipping costs.

If that route gives marketers a better margin, they may prefer to buy through Lomé instead of buying directly in Nigeria.

This is known as arbitrage.

Arbitrage happens when traders take advantage of price differences between two markets. In this case, the difference is between the domestic refinery-gate price in Nigeria and the regional benchmark price through Lomé.

That is why Dangote-refined fuel can leave Nigeria and still return as an imported product.

Lomé is also important for logistics

Lomé’s role is not only about price. It is also about logistics.

The offshore Lomé hub is a major ship-to-ship trading point in West Africa. It can receive large fuel cargoes and redistribute them into smaller vessels.

This matters because many ports across West Africa cannot easily receive fully loaded medium range vessels.

Lomé solves that problem by acting as a redistribution centre. Large cargoes can arrive there, then smaller vessels can move the fuel to different ports across the region.

This makes Lomé useful even when the fuel originally comes from Dangote.

In other words, Lomé helps traders manage both price and movement. It gives them a place to trade, blend, store and redistribute petroleum products across West Africa.

Why this does not mean Dangote has failed

The re-import pattern does not mean Dangote Refinery has failed.

In fact, it shows the opposite in some ways.

Dangote has become such an important supplier that its products are now moving across the regional fuel market. The refinery is no longer only serving Nigeria. It is also feeding West African and international supply chains.

But this creates a more complicated domestic picture.

Nigeria may appear to be importing more fuel, even when some of that fuel originally came from a Nigerian refinery.

That means the headline import figure may not always show true dependence on foreign refiners. Sometimes, it may show a trading loop created by pricing and logistics.

Petrol imports rose despite lower consumption

Nigeria’s official petrol supply data shows why this matters.

Figures from the Nigerian Midstream and Downstream Petroleum Regulatory Authority showed that average daily petrol imports rose sharply in May.

Imports increased from 3.7 million litres per day in April to 5.9 million litres per day in May.

That was a 59.5 percent increase.

This happened even though nationwide petrol consumption fell during the same period.

Total petrol supply in May stood at 47.4 million litres per day. Dangote’s domestic deliveries accounted for 41.5 million litres per day, which was only slightly higher than the previous month.

In simple terms, Nigeria consumed less petrol in May. Dangote still supplied a large volume locally. Yet imports increased.

That is where the Lomé explanation becomes important.

If part of the imported fuel was originally Dangote product that passed through Lomé, then the import rise may not mean Nigeria suddenly needed more foreign-refined petrol. It may mean marketers were using the Lomé route because the pricing and logistics worked better for them.

Why the import numbers look confusing

On paper, the numbers can look contradictory.

A large domestic refinery should reduce petrol imports. And to a large extent, Dangote has already helped reduce Nigeria’s dependence on imported fuel.

But if marketers export some Dangote product to Lomé and later bring it back, the same fuel may still appear as an import in official records.

This makes the supply picture more complicated.

The product may be Nigerian-refined, but because it came back through an offshore hub, it can still be recorded as imported fuel.

That is why Nigeria’s fuel market should not be judged by import figures alone. The source of the product, the trading route and the pricing structure all matter.

What this means for Nigeria’s import bill

Dangote Refinery has helped reduce Nigeria’s petrol import bill.

But the Lomé re-import trend shows that the progress is not only about refining capacity.

It also depends on price.

If marketers can make better margins by buying through Lomé, they may continue to do so, even when the fuel was originally refined in Nigeria.

This means Nigeria’s fuel independence will not be achieved by local refining alone.

The country also needs a domestic supply chain that is competitive, efficient and attractive to marketers.

If buying directly in Nigeria is less profitable than routing the product through Lomé, traders will keep choosing the more profitable route.

What this means for policymakers

For policymakers, the lesson is clear.

Local refining capacity is important, but it is not enough.

Nigeria must also look at pricing, port infrastructure, coastal shipping, storage, regulation and market incentives.

If the domestic market is not structured properly, Nigerian-refined fuel can still take the long route out of the country and back in.

That means the government must ask deeper questions.

Why is the Lomé route more attractive to marketers?

Is the domestic pricing structure discouraging direct purchases?

Are Nigeria’s ports and storage systems strong enough to support local supply?

Are marketers responding to genuine cost advantages or regulatory gaps?

These are the questions that matter if Nigeria wants to reduce fuel imports in a real and lasting way.

The simple explanation

The simple explanation is this:

Dangote fuel is being transferred to Lomé and re-imported because traders can sometimes make more money through the Lomé route than by buying directly from the refinery gate in Nigeria.

Lomé gives marketers two advantages.

First, it offers a regional pricing benchmark that may create better margins.

Second, it provides a logistics hub where large cargoes can be broken into smaller shipments and moved across West Africa.

So the main reason is not scarcity.

It is not necessarily because Dangote cannot supply Nigeria.

It is mainly about pricing, profit margins and logistics.

What you should know

Nigeria may be importing some fuel that was originally refined by Dangote.

The main reason is pricing arbitrage.

Marketers use the Lomé route when it gives them better margins.

Lomé is also useful because it helps move fuel across West Africa through ship-to-ship transfers.

Nigeria’s petrol imports rose in May even though consumption fell.

Dangote’s local supply remained strong, but imports still increased.

This suggests that some imports may be part of a regional trading loop.

For Nigeria, the key lesson is that local refining capacity is important, but pricing and logistics will decide how much fuel stays in the domestic market.

Expert view

Energy market experts are likely to see the Lomé re-import pattern as a sign that West Africa’s fuel market is becoming more connected and more price-driven.

In a market where traders are guided by margins, fuel will move through the route that offers the best commercial return.

This does not mean Dangote Refinery has failed. It means the refinery is now deeply linked to regional and global fuel markets.

However, it also means Nigeria must be careful when measuring energy independence.

A lower import bill is good. But if Nigerian-refined fuel can still leave the country and return as an import because of pricing gaps, then policymakers need to look beyond refinery output.

The long-term solution is to make direct domestic sourcing more efficient, competitive and reliable.

If marketers find it easier and more profitable to buy locally, the re-import loop will reduce naturally.

Frequently Asked Questions

1. Why is Nigeria importing fuel refined by Dangote?

Nigeria is reportedly re-importing some Dangote-refined fuel because marketers can sometimes get better margins by sourcing through the Lomé trading hub instead of buying directly from the refinery gate in Nigeria.

2. What is the main reason Dangote fuel goes to Lomé first?

The main reason is pricing arbitrage. Marketers may earn better margins when the product is traded through Lomé. Lomé also helps with logistics by redistributing large cargoes into smaller shipments.

3. Does this mean Nigeria still depends on foreign refineries?

Not exactly. Some of the fuel recorded as imports may have originally come from Dangote Refinery. So the import figure may partly reflect a trading route, not only dependence on foreign refiners.