A fresh industrial crisis is brewing in Nigeria’s downstream oil sector as the Dangote Group faces sharp criticism from the National Association of Road Transport Owners (NARTO) over its new distribution model, which offers free fuel deliveries directly to major consumers and filling stations.
The development, according to NARTO President, Alhaji Yusuf Othman, is threatening existing agreements between truck owners and their long-term clients. Othman disclosed that Dangote’s strategy of delivering fuel at no additional cost to filling stations, telecommunications companies, and other large-scale consumers has pushed many clients to abandon their contractual commitments with transporters.
Speaking on the matter, Othman warned that the practice could cripple thousands of truck owners who invested heavily in vehicles and financing facilities based on binding agreements with oil marketers and corporate consumers.
“We have our members who signed agreements, some formal, others informal with many companies. Those formal agreements were the basis upon which many of our members accessed bank loans to buy trucks and provide transportation services. But now, those agreements are at risk because a ‘big brother’ has entered the scene to deliver fuel for free, disregarding our contracts,” Othman said.
The NARTO president further lamented that the new model, though not officially confirmed, has already begun affecting their operations. He noted that if Dangote continues supplying fuel directly to end-users without using independent truckers, thousands of trucks belonging to union members would be rendered redundant, leading to huge financial losses and possible job cuts.
Othman also called on the Federal Government, particularly the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), to intervene, stressing that the practice contravenes provisions of the Petroleum Industry Act (PIA).
“The NMDPRA has already told us clearly that such an arrangement is an illegal act under Section 212 of the PIA. That is why we are appealing for government intervention before this escalates into a full-blown crisis,” he added.
Industry analysts say the conflict highlights a brewing struggle between traditional logistics operators and vertically integrated energy giants like Dangote, which are increasingly seeking to cut costs by eliminating third-party transporters. While some consumers welcome the cost savings, unions argue that the move could destabilize the transport sub-sector and trigger wider ripple effects on jobs and the economy.
As the Dangote Refinery ramps up operations, stakeholders warn that how this dispute is resolved may set the tone for future relations between the nation’s largest private refinery and transport operators critical to Nigeria’s downstream petroleum distribution network.
