Subsidy Elimination Triggers Petrol Price Surge, Exceeding N500 Per Litre

In a significant development, the regulatory and operational sectors of Nigeria’s petroleum industry have officially implemented a petrol subsidy withdrawal. This has led to an abrupt surge in retail prices, with an approximately 170 per cent increase to N500 per litre, up from the previous official rate of N185 per litre.

The commencement of this new pricing model took place yesterday, subsequent to an unresolved meeting between the Federal Government and the Nigeria Labour Congress (NLC), along with the Trade Union Congress (TUC), held in Abuja.

During his inaugural address on Monday, President Bola Tinubu unequivocally pronounced the subsidy a thing of the past.

The report elaborating on the new pricing structure also unveiled that Borno and Yobe states bear the highest petrol prices in Nigeria at N557 per litre. At the same time, Lagos offers the least costly rate at N488 per litre.

The document further elaborates on the pricing across various states. For instance, petrol will now be sold at N537 per litre in Abuja, Nasarawa, Plateau, Kogi, Benue and Niger states, while Kwara State will have a rate of N515 per litre. States such as Adamawa, Taraba, Bauchi and Gombe will witness a price tag of N550 per litre, whereas Kano, Kaduna, Katsina, Sokoto and Jigawa will offer it at N540 per litre. The document specifies the prices for Kebbi, Zamfara, and Abia as N545, N540 and N515 per litre, respectively.

Inspection of the depots revealed that owners who had previously ceased operations due to the unstable environment had recommenced their operations yesterday, selling petrol at N470 per litre. It is estimated that approximately N300 per litre will be allocated as charges and margins for the stakeholders in the value chain, including transporters and oil marketers.

NNPC Limited, in a statement issued by the Chief Corporate Communications Officer, Garba Deen Muhammad, affirmed that the pump prices at its retail stations had been revised in accordance with the current scenario.

The statement read, “NNPC Limited wishes to inform our esteemed customers that we have adjusted our pump price of PMS across our retail outlets, in line with the current market realities.”

A check by Vanguard in Abuja City Centre and the neighbouring areas found that while NNPC retail stations increased their prices to N537 per litre from N195, major and independent marketers sold at N540 per litre.

The Public Relations Officer of the Independent Marketers Association of Nigeria (IPMAN), Chief Chinedu Ukadike, expressed that although the marketers were anticipating official information regarding the new ex-depot price, the group was geared up for a competitive market. He stated, “We have not been officially communicated on the new ex-depot price but we have seen the pricing list being shared on social media for NNPC stations. We are ready for deregulation. As of today, NNPC remains the sole importer of petrol into the country. This will have to change.”