FG Bows to Pressure, Suspends 15% Import Duty on Petroleum Products as NMDPRA Moves to Calm Anxiety and Avert Panic Buying Across Nigeria

In a decisive move that signals a response to growing economic concerns and mounting public unease, the Federal Government of Nigeria has officially suspended its earlier plan to impose a 15 percent ad-valorem import duty on petroleum products. The decision, announced through the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), comes amid fears that such a policy would trigger a sharp increase in fuel prices, worsen inflation, and ignite yet another round of panic buying that could plunge the nation into fuel scarcity.

The announcement, contained in an official statement signed by George Ene-Ita, Director of Public Affairs at the NMDPRA, emphasized that the government had taken into account the current volatility in the global oil market and domestic economic realities before deciding to step back from the implementation of the duty. According to the Authority, the suspension aims to stabilize the supply chain, protect consumers, and ensure that Nigeria’s already fragile energy market remains steady through the peak demand season.

But behind this seemingly straightforward announcement lies a complex web of economic strategy, regulatory maneuvering, and political calculation. The proposed 15% import duty—initially introduced as part of a broader fiscal reform agenda—was intended to boost government revenue and encourage local refining by making imported petroleum products less attractive. However, the policy quickly drew criticism from stakeholders who argued that it was ill-timed, counterproductive, and likely to have devastating ripple effects on the economy.

A Policy That Sparked Nationwide Concern

Sources within the petroleum industry reveal that the proposal for the 15% duty was first floated in internal policy discussions at the Ministry of Finance and the Nigerian Customs Service as part of efforts to increase non-oil revenue streams. With crude oil revenues under pressure due to fluctuating production volumes and persistent crude theft in the Niger Delta, the government had been exploring alternative means of revenue generation. However, as the idea gained traction, industry players and market observers warned that it could backfire.

The Nigerian economy, still reeling from the impacts of fuel subsidy removal, rising inflation, and the depreciation of the naira, was in no position to absorb a fresh price shock. Petrol and diesel are central to every sector—from transportation and agriculture to power generation. Any upward adjustment in their prices would immediately translate into higher costs of living for ordinary Nigerians, most of whom already struggle with skyrocketing prices of food, transportation, and basic goods.

The policy also risked undermining the fragile balance of Nigeria’s post-subsidy fuel market. Since the deregulation of petrol pricing, importers have been operating under thin margins, constrained by forex scarcity and fluctuating landing costs. The introduction of a 15% import duty, many argued, would make it almost impossible for marketers to maintain stable pump prices, likely forcing them to pass the cost to consumers or cut back on importation altogether—both scenarios capable of sparking nationwide scarcity.

NMDPRA Steps In To Restore Calm

It was against this backdrop that the NMDPRA issued its statement, not only announcing the suspension of the policy but also appealing for calm across the supply chain. “There is adequate supply of petroleum products in the country, within the acceptable national sufficiency threshold during this peak demand period,” the statement assured.

The Authority revealed that current stocks of petroleum products—including Premium Motor Spirit (PMS), Automotive Gas Oil (AGO or diesel), and Liquefied Petroleum Gas (LPG)—were sufficient to meet national demand. These supplies, it explained, were being drawn from both local refining sources and importation, ensuring that retail outlets remain replenished.

By emphasizing “robust domestic supply” and “timely replenishment of stocks,” the NMDPRA sought to reassure Nigerians that there was no need for panic buying or hoarding. Panic buying has long been a self-fulfilling prophecy in Nigeria’s petroleum market: once rumors of scarcity begin to spread, consumers rush to fill their tanks and jerry cans, quickly exhausting available supplies and causing the very shortages they fear. The Authority’s swift response appears aimed at preempting that chain reaction.

“The Authority wishes to use this opportunity to advise against any hoarding, panic buying, or non-market reflective escalation of prices of petroleum products,” the statement read, a clear warning to both consumers and marketers. It further noted that enforcement teams would be on the ground to monitor compliance and ensure that products are sold at fair, market-determined prices.

A Balancing Act Between Market Forces and Public Welfare

The suspension of the duty highlights the delicate balancing act the federal government faces in managing Nigeria’s petroleum sector in a post-subsidy environment. While deregulation theoretically allows market forces to determine prices, the government has remained under pressure to intervene when those forces threaten social stability.

Economic analysts note that the decision to suspend the import duty reflects a pragmatic recognition of Nigeria’s economic fragility. With inflation hovering at historic highs and disposable incomes shrinking, imposing additional levies on essential commodities like fuel could have provoked widespread public outrage. “The timing of such a policy was politically and economically untenable,” said a Lagos-based energy analyst who spoke on condition of anonymity. “Even if the government needs revenue, it cannot generate it by strangling consumption in a depressed economy.”

The analyst added that the NMDPRA’s proactive communication was a welcome development, contrasting sharply with the opacity that often surrounds fuel policy decisions in Nigeria. “In the past, rumors and speculation filled the vacuum left by government silence. This time, at least, the Authority is trying to get ahead of the narrative.”

The Politics of Fuel and the Public’s Trust

Fuel pricing in Nigeria has always been more than just an economic issue—it is deeply political. Every adjustment in fuel policy reverberates through the country’s political and social fabric. The memory of past fuel crises, often triggered by unclear government policies, remains fresh in the minds of Nigerians. For decades, citizens have endured long queues, black-market sales, and skyrocketing prices whenever there was uncertainty in the sector.

This historical distrust means that any signal of potential policy change—such as the planned import duty—tends to be met with alarm. It is precisely this public anxiety that the NMDPRA’s latest statement sought to address. By emphasizing both the adequacy of supply and the suspension of the import duty, the Authority aimed to rebuild public confidence and avert the panic that could easily spiral into another national crisis.

George Ene-Ita’s statement also highlighted the NMDPRA’s commitment to “monitor the supply situation and take appropriate regulatory measures to prevent disruption.” This implies a readiness to act swiftly in the event of any attempt by marketers to manipulate the situation for profit or to create artificial scarcity.

Industry Reactions and Stakeholder Dynamics

Within hours of the announcement, reactions poured in from across the petroleum industry. Independent marketers, who had been bracing for a potential increase in operating costs, welcomed the decision as a relief. The Independent Petroleum Marketers Association of Nigeria (IPMAN) described it as “a necessary corrective step” that would help maintain stability in the distribution chain.

Similarly, depot operators and transporters noted that the suspension of the duty would prevent a cascade of logistical cost increases that might have affected product movement from coastal depots to inland states. Some stakeholders, however, cautioned that the suspension should not be mistaken for a long-term solution, stressing the need for a sustainable framework for balancing revenue generation with consumer protection.

The Nigerian Labour Congress (NLC), which had previously criticized the government’s handling of post-subsidy fuel pricing, reacted cautiously. While acknowledging the suspension as a “positive move,” the union reiterated its call for greater transparency in petroleum pricing and supply. “What Nigerians need is stability and honesty in the energy sector,” an NLC spokesperson said. “Policies should be people-centered, not revenue-driven.”

Lessons from the Episode

The quick reversal of the 15% import duty plan underscores the growing realization within government circles that policy formulation in the petroleum sector cannot occur in isolation from public sentiment and macroeconomic realities. Over the years, Nigeria’s fuel policies have swung between extremes—state control through subsidies and deregulation guided by market forces—often with little coordination or foresight.

Experts argue that what the country needs is a coherent long-term strategy that incentivizes local refining, ensures competitive importation, and protects consumers from volatility. The ongoing rehabilitation of state-owned refineries and the expected ramp-up of production from the Dangote Refinery could, in time, reduce dependence on imports and shield Nigeria from external shocks. However, until these projects reach full operational capacity, the country remains vulnerable to policy missteps in the import segment.

Looking Ahead: A Pledge of Energy Security

In closing its statement, the NMDPRA reaffirmed its commitment to ensuring uninterrupted supply and energy security for Nigeria. The tone of the message was both conciliatory and confident—acknowledging public concerns while projecting an image of control and preparedness. The Authority expressed appreciation for the “continued efforts of all stakeholders in the midstream and downstream value chain” and promised ongoing vigilance to sustain a smooth flow of petroleum products across the nation.

For now, Nigerians can breathe a sigh of relief. The specter of another fuel crisis appears to have been averted—at least temporarily. Yet the episode serves as a reminder of how precarious the nation’s energy ecosystem remains. Each policy shift, each regulatory tweak, carries the potential to ripple through the economy and affect millions of lives.

As tankers continue to offload at ports and filling stations resume normal operations, the suspension of the 15% import duty stands as both a policy retreat and a reaffirmation of the government’s awareness of the people’s daily struggles. Whether this marks the beginning of a more consultative and stability-oriented approach to petroleum regulation remains to be seen. But for now, the message from the NMDPRA is clear: there is no cause for alarm, and Nigeria’s energy supply remains secure.