Written by SpringsNewsNG Media Limited, March 31, 2025

The Federal Government’s failure to renew the Crude for Naira agreement between NNPC Limited and Dangote Refinery, alongside rising global crude oil prices, is set to push petrol pump prices higher across Nigeria in April and beyond.

The six-month agreement, which expired in March, was initially brokered by the government last year. It allowed the national oil company to supply crude oil to the 650,000-barrel-per-day Dangote Refinery, with payments made in Naira. Despite initial challenges, the deal gradually reduced petrol prices from over N1,000 per litre to around N820, depending on location. However, following the failure of the two companies to renew the agreement, Dangote Refinery recently announced it was halting the sale of petrol products to the domestic market in Naira.

This decision has raised concerns about rising petrol prices, with reports already indicating price increases. According to the latest price list obtained from MRS Oil and Gas, petrol pump prices have surged to as high as N960 per litre. Private oil depots have also increased petrol prices to N900 per litre from over N890 per litre due to rising crude oil costs and other market factors.

Regional Price Breakdown

• Lagos: N930 per litre
• South West (Ogun, Oyo, Osun, Ekiti, Kwara, Ondo): N940 per litre
• South South and South East (Edo, Abia, Akwa Ibom, Bayelsa, Rivers, Cross River, Enugu): N960 per litre
• Abuja, Kaduna, Benue, Kogi, Niger, Sokoto, Kebbi, Nasarawa: N950 per litre
• Northern states (Zamfara, Kano, Jos, Bauchi, Taraba, Adamawa, Borno, Katsina, Jigawa, Gombe, Yobe): N960 per litre

The http://Free Carrier Agreement (FCA) price, which determines how much marketers pay before selling fuel, also varies across regions. While Borno’s FCA price stood at N905 per litre, Taraba, Adamawa, and Yobe recorded an FCA price of N888 per litre.

Private Depots Raise Prices Private oil depots, including Rainoil, Prudent, A.Y.M Shafa, and Mainland, have adjusted their depot prices to N900 per litre. This is expected to further push up petrol pump prices at filling stations.

Additionally, the price of crude oil, a major feedstock for refining, rose from $70 to $75 per barrel, causing refineries, including the $20 billion Dangote Refinery, to incur additional costs. In line with Dangote Refinery’s pronouncement, it did not load trucks for local distribution under the Naira-for-Crude programme, instead opting for lifting through ships at dollar rates.

Petrol Price Likely to Increase Further Petroleum marketers have warned that pump prices could rise further unless the Federal Government resolves the dispute between NNPC Limited and Dangote Refinery. Chinedu Ukadike, Public Relations Officer of the Independent Petroleum Marketers Association of Nigeria (IPMAN), noted that the cost of sourcing foreign exchange for petroleum imports would contribute to price increases.

Marketers have also expressed concerns that petrol might soon be sold in dollars, worsening pressure on the Naira and leading to further inflation.

Impact on Inflation and Economy The price hike has already impacted oil marketers, who must now source supply at higher dollar rates. According to the Major Energies Association of Nigeria (MEMAN), the landing cost of imported petrol increased by N88 per litre within a week, rising from N797 to N885 per litre.

Billy Gillis-Harry, President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), warned that increased petrol prices would lead to higher transport fares and rising costs of goods and services. Many marketers are struggling to meet foreign exchange rates, which affects fuel availability in some regions.

Dr. Muda Yusuf, CEO of the Center for the Promotion of Private Enterprise (CPPE), highlighted that rising crude prices, the collapse of the Naira-for-Crude agreement, and foreign exchange instability are major factors driving petrol price increases. He warned that the resulting inflation could impact investor confidence and Nigeria’s macroeconomic stability.

Calls for Government Action IPMAN has urged the Federal Government to revive the Naira-for-Crude programme, arguing that it previously helped stabilize the market by allowing marketers to buy directly from refineries in Naira. Failure to renew the programme, they warned, could encourage massive petrol importation, hoarding, and further price hikes.

Some industry players have called for increased investment in domestic refineries, urging International Oil Companies (IOCs) to participate in refining activities to reduce reliance on imported fuel.

Consumer Reactions Consumers have voiced frustration over the price hikes. A Bolt driver, Marcus Ojie, noted that rising petrol prices have forced him to increase fares, affecting his customers. Similarly, John Yangabe, a civil servant, expressed disappointment, stating that the increase makes commuting unaffordable. He called on the government to take urgent action to stabilize petrol prices and reduce economic hardship.

The current petrol price crisis underscores the urgent need for government intervention to address domestic supply chain challenges and ensure stable fuel prices for Nigerians.