Nigeria Warned Petrol Prices Could Exceed N1,000 Per Litre Following Tinubu’s 15% Fuel Import Tariff

Nigeria Warned Petrol Prices Could Exceed N1,000 Per Litre Following Tinubu’s 15% Fuel Import Tariff

Petroleum marketers have expressed concerns that the recent approval of a 15% ad valorem import tariff on fuel by President Bola Tinubu could cause the pump price of petrol, popularly known as Premium Motor Spirit (PMS), to surpass N1,000 per litre. The policy, which will take effect after a 30-day transition ending on November 21, 2025, aims to shield local refineries and curb the influx of cheaper imported fuels threatening Nigeria’s domestic refining efforts.

Industry insiders warn that the move might have unintended consequences, potentially pushing retail prices beyond what most Nigerians can afford. Several depot operators, speaking anonymously, indicated that petrol prices, currently around N920 per litre in many areas, could escalate further, possibly exceeding N1,000.

One depot operator lamented, “As it stands, fuel could go above N1,000 per litre. I don’t understand why the government would add to people’s suffering.” Another added that some importers are allegedly working in tandem with Dangote, which might have contributed to the recent uniform price increases across the sector. They cautioned that without proper market regulation, the new duty could trigger more price hikes and deepen consumer hardship.

Hammed Fashola, Vice-President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), acknowledged the tariff’s potential impact, noting it might drive prices up but also serve to discourage imports and bolster local refining. He expressed concern that the policy could be exploited by some marketers to monopolize the sector, benefitting major players like Dangote’s refineries.

Fashola emphasized that Nigeria’s local refiners’ inability to meet domestic demand could precipitate a fuel shortage. “If they fail, it could lead to scarcity. We need to support our refineries to prevent such crises,” he said. He also assured that the government’s actions are in line with the Petroleum Industry Act (PIA), which aims to promote local refining without contravening existing laws.

He urged the Nigerian National Petroleum Company Limited (NNPC) to expedite the revamp of major refineries in Port Harcourt, Warri, and Kaduna, to increase local production capacity. Fashola believes that bringing private refineries into operation will foster competition and reduce fears of monopolies.

Meanwhile, Billy Gillis-Harry, President of PETROAN, called the tariff a “win-win,” emphasizing the need to balance product availability and affordability. He warned that excessive reliance on Dangote’s refinery alone might lead to shortages and price spikes, advocating for a diversified supply approach.

The policy aligns with President Tinubu’s directive, outlined in a letter dated October 21, 2025, to the Attorney-General, the Federal Inland Revenue Service (FIRS), and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). It mandates immediate implementation of the 15% duty on imported petrol and diesel, assessed on the cost, insurance, and freight (CIF) value, with all payments funnelled into a designated federal revenue account.

The proposal aims to align import costs with local market realities, potentially increasing petrol’s landing cost by about N99.72 per litre, based on September 2025 consumption figures. Despite this, projections suggest that Lagos pump prices could still stay below N965 per litre, remaining competitive compared to regional prices.

The initiative is designed not as a revenue-generating measure but as a corrective step to support local refining, stabilize prices, and strengthen Nigeria’s oil economy. It also seeks to prevent duty-free imports from undermining emerging domestic refineries and encourage investments in refining infrastructure.

The NMDPRA has been directed to develop regulations and oversee the policy’s implementation, including periodic reviews to adjust or eliminate the tariff as local refining capacity improves. The policy is underpinned by sections of the PIA, which empower the regulator to enforce such interventions for energy security and economic growth.

Energy analysts have voiced cautious optimism, noting the potential benefits of boosting local refining and revenue but warning about possible risks like supply disruptions and increased consumer prices. Some critics, including opposition figures and industry stakeholders, argue that the policy could deepen hardships, especially amid rising fuel costs and existing economic challenges.

Notably, some Nigerians have linked the policy to comments by Dangote, suggesting it might help strengthen the naira by promoting local refining, while others see it as a short-sighted move that could limit consumer options and destabilize the market.

Amidst the debate, President Tinubu’s government maintains that the policy is a strategic step toward energy independence, domestic capacity building, and economic resilience. The full implementation awaits formal directives and regulatory adjustments, with the NMDPRA preparing to oversee the transition once the policy is officially enacted.