Editor’s Note:
This report provides background and context on the ongoing debate around fuel pricing authority in Nigeria following subsidy removal.
Background
Fuel Pricing After Subsidy Removal
Nigeria’s downstream petroleum sector has remained under intense scrutiny since the removal of fuel subsidy. While prices were expected to reflect market realities. Disagreements have continued over who truly has the authority to set pump prices and how fair competition can be achieved.
At the centre of one such dispute is the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Nigerian National Petroleum Company Limited (NNPCL).
IPMAN’s Position on NNPCL Pump Prices
Speaking on the matter, Chinedu Anyaso, Chairman of IPMAN Enugu Depot Community, stated that independent marketers are not bound by pump prices announced by NNPCL.
According to him, “NNPCL’s dual perception as both a market participant and price reference point continues to raise concerns about transparency and fairness.” Saying "NNPCL operates as a commercial entity and cannot simultaneously function as a regulator of fuel prices across the market." He maintained that the prices released by NNPCL represent company-specific selling prices, not a legally binding national benchmark.
Depot Prices and Regional Market Realities
Anyaso explained that in regions such as the South-East, pump prices should logically reflect private depot supply costs, logistics, and market conditions rather than a single national template.
He argued that forcing independent marketers to follow NNPCL prices without considering depot realities distorts the market and places smaller operators at a disadvantage.
Concerns Over Exploitative Pump Prices
While opposing NNPCL’s pricing authority, IPMAN also condemned fuel stations selling petrol at excessively high prices, reportedly reaching prices above #1000 and have since risen significantly and now vary widely across regions.
Anyaso described such practices as exploitative, stressing that market liberalization should not translate into unchecked profiteering at the expense of consumers.
More Importers to Break Monopoly
A major concern raised by IPMAN is NNPCL’s dominance as the primary importer of petrol (PMS). Anyaso urged the Federal Government to issue licenses to more qualified importers, noting that competition is essential for price stability.
According to him, allowing multiple importers into the market would naturally introduce price competition, reduce supply pressure, and limit monopolistic influence.
Competition in Fuel Pricing
Industry observers have long argued that a single dominant supplier undermines true deregulation. IPMAN’s position aligns with broader calls for a fully competitive downstream market, where prices are shaped by supply, demand, and efficiency rather than administrative influence.
Such competition, Anyaso said, would allow prices to “find their natural level” while still protecting consumers from abuse.
The disagreement between IPMAN and NNPCL highlights unresolved structural issues in Nigeria’s post-subsidy fuel market. Questions around pricing authority, competition, and consumer protection remain central to economic stability and daily life.
- Fuel pricing is no longer just about where petrol is gotten anymore as its costs continue to affect: transport cost
- food prices
- inflation
- household spending and
- small businesses.
Who really determines the price Nigerians pay at the pump?
Since mid-2024, Nigeria’s fuel pricing landscape has continued to evolve, but the core issues raised by IPMAN remain largely unresolved. The entry and expansion of local refining, particularly from the Dangote Refinery, has introduced a new layer of competition into the downstream market. Marketers now have alternative supply options beyond the Nigerian National Petroleum Company Limited, gradually reducing dependence on a single dominant importer.
Despite this progress, pump prices have remained unstable, largely influenced by foreign exchange fluctuations, logistics costs, and regional supply differences. Prices now vary significantly across states, reinforcing IPMAN’s position that a uniform national pump price may not reflect actual market realities.
Industry analysts maintain that the true test of deregulation goes beyond subsidy removal. It rather lies in whether genuine competition can exist without dominance from any single major player, including the Dangote Refinery, and an administration with a different priority.
However, public discourse has largely focused on fuel importation, with far less attention given to the role and current state of Nigeria’s government-owned refineries, where revamp efforts were initiated under the administration of former President Muhammadu Buhari. Their expected impact on domestic supply and price stability is yet to be meaningfully felt, especially when compared to the visible contribution of the Dangote Refinery.
This raises broader questions about institutional efficiency and accountability. If a project of Dangote’s scale were part of the state-owned refinery system, would it have reached operational status under current conditions, or would it have faced the same delays and recurring justifications that have long characterized Nigeria’s public refineries?
As of 2026, Nigeria’s fuel market reflects a complex transition phase, no longer fully controlled locally, yet not fully competitive. Recent global tensions affecting oil supply routes, particularly around the Strait of Hormuz, have added fresh pressure to fuel prices worldwide, including in Nigeria.
Fuel prices, which had shown signs of easing under the Dangote-led supply dynamics, have once again responded to rising crude oil costs and foreign exchange pressures linked to geopolitical uncertainty in the Middle East. These developments have pushed costs higher across international markets.
For Nigeria, this means that even with improving local refining capacity, petrol prices remain heavily influenced by global forces. The expectation that the Dangote Refinery alone would stabilize prices has been tempered by market realities, a single large facility cannot fully shield consumers from global oil price movements, exchange rate volatility, and distribution costs, particularly within a system still facing structural and policy challenges.
At the same time, Nigeria’s state-owned refineries have yet to operate at full capacity, leaving the country reliant on external pricing dynamics. These developments underscore a critical point: fuel pricing in Nigeria is no longer just a local policy issue, it is deeply tied to global energy markets, supply risks, and economic conditions beyond the country’s direct control, despite being a crude oil-producing nation not directly involved in these external conflicts.
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