An investigative feature on the policy ripple that could reshape Nigeria’s fuel economy — and the lives tethered to it.
When Nigerians woke up to the news that President Bola Ahmed Tinubu had approved a 15 per cent import tariff on petrol and diesel, reactions across the country were as swift as they were divided. For some, the announcement marked a long-overdue step toward protecting local refineries and ending the country’s dependence on imported petroleum products. For others — particularly ordinary citizens already grappling with rising living costs — it was one more nail in the coffin of affordability.
The move, coming just over a year after Tinubu’s dramatic removal of the decades-old fuel subsidy, has rekindled a heated national debate: is Nigeria truly on the path to energy self-sufficiency, or is the government simply rebranding hardship as reform?
At the heart of this latest policy lies a single figure that has ignited anxiety across fuel depots, transport parks, and kitchen tables alike — ₦1,000 per litre. That is the price petroleum marketers now predict Nigerians may soon pay for petrol, as the new tariff takes effect by late November 2025.
A Nation at the Pumps
Across Nigeria’s sprawling cities and dusty rural roads, petrol is more than just a commodity — it is the pulse of survival. From the yellow buses in Lagos to the grinding generators that light up small barber shops in Kano, fuel has long been the invisible artery of daily life.
But in the months leading up to this announcement, the price of Premium Motor Spirit (PMS) — known locally as petrol — had already reached unprecedented highs, averaging around ₦920 per litre in some states. For millions of Nigerians earning below the poverty line, it was already unaffordable. The fresh tariff, experts say, could push it beyond ₦1,000 — an amount unthinkable just two years ago.
The administration’s rationale is clear on paper: the new tariff, described as a 15 per cent ad valorem import duty, is meant to protect domestic refiners like the Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPCL) from being undercut by cheaper imported products. It is, according to officials, a “strategic, market-responsive measure” to stabilise the downstream oil sector and encourage local production.
But critics argue that it is ordinary Nigerians — not importers — who will bear the brunt.
“This Will Add More to People’s Suffering”
In a telephone interview, one depot operator, speaking under condition of anonymity, summed up the fears echoing through Nigeria’s oil distribution chain.
“As it is, the price of fuel may go above ₦1,000 per litre. I don’t know why the government will be adding more to people’s suffering,” he lamented.
Another operator was more pointed:
“Some importers are working in alignment with Dangote, which is why the last price increase was general. All players raised their prices at once. Let’s just wait and see what happens next.”
These comments highlight a suspicion that has quietly brewed since Dangote’s massive 650,000-barrel-per-day refinery began operations earlier in the year: that government policy is tilting the playing field in favour of a few industrial giants at the expense of open competition.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) seems torn between optimism and caution. Its National Vice President, Hammed Fashola, admitted that while the tariff might protect local refiners, it could also discourage importation and trigger shortages if domestic production cannot meet demand.
“The 15 per cent tariff on imported fuel has its own implications,” Fashola told reporters. “Maybe the price will go up, and equally, it will discourage importers from bringing in fuel if it becomes too costly. It has both negative and positive effects. People will see it as a way of monopolising the industry for certain people.”
Fashola’s comment underscores a dilemma that has haunted Nigeria’s oil industry for decades: every attempt at reform seems to create new distortions.
If local refineries fail to meet domestic demand, he warned, the result could be devastating.
“It may lead to scarcity, and people will not have an alternative.”
The Policy Behind the Numbers
Documents obtained from the Presidency and the Federal Inland Revenue Service (FIRS) reveal the thinking behind the policy. In a letter dated October 21, 2025, President Tinubu approved the proposal by FIRS Chairman, Dr. Zacch Adedeji, to impose the 15 per cent tariff as part of his “Renewed Hope Agenda” for fiscal sustainability.
The tariff will be assessed on the cost, insurance, and freight (CIF) value of imported petrol and diesel, and payments will go into a designated federal revenue account managed by the FIRS.
According to projections in the memo, the measure could increase petrol’s landing cost by approximately ₦99.72 per litre, translating into an additional ₦1.92 billion in daily import costs. That increase, government insiders argue, is a necessary “alignment” to make locally refined fuel more competitive.
Adedeji defended the move, saying:
“While domestic refining of petrol has begun to increase and diesel sufficiency has been achieved, price instability persists, partly due to the misalignment between local refiners and marketers. Our responsibility is to protect consumers and domestic producers from unfair pricing practices while ensuring a level playing field.”
In other words, the tariff is meant not to raise revenue but to rebalance the market. Yet, in a country where energy costs are directly linked to inflation, transportation, and food prices, even a small “realignment” can have seismic effects on the cost of living.
The PIA and Presidential Power
The legal foundation for the tariff lies in Sections 21 and 22 of the Petroleum Industry Act (PIA), which empower regulators to impose measures promoting national energy security. The President, under Section 3(4), can also issue policy directives to the regulator.
Thus, Tinubu’s approval, according to legal analysts, is within the bounds of the law. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) is now expected to gazette the policy and issue implementing regulations by late November.
Once the 30-day transition window lapses, importers bringing petrol or diesel into Nigeria will have to pay the 15 per cent duty at discharge before clearance.
But for many, legality is not the issue — livelihood is.
“We Can’t Even Go Fishing Anymore”
Chief Ayiri Emami, a chieftain of the All Progressives Congress and oil magnate from Delta State, minced no words at a press briefing in Abuja. He described the new policy as “heartless” and warned that it would push millions deeper into hardship.
“Anybody advising Mr President to impose a 15 per cent tax on petroleum right now is not doing him any good,” Emami said. “This kind of policy will not hurt marketers; it will hurt ordinary Nigerians. Whatever tax you put on petroleum goes straight back to the people on the streets.”
He painted a vivid picture of the economic pain already spreading through coastal communities where fuel is lifeblood.
“When you buy fuel, it determines whether you can even go out to fish. It’s not that the fish are gone; it’s that we can’t afford to reach them anymore.”
For Emami, the timing could not be worse. “Even after removing the fuel subsidy, we haven’t seen much positive reflection. Things are still hard. So why add another burden?”
His statement resonates deeply with citizens who feel trapped between government reforms and a shrinking economy.
Marketers in the Middle
Caught between government policy and consumer outrage are Nigeria’s petroleum marketers, many of whom say the tariff could disrupt their operations.
The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), through its President Billy Gillis-Harry, struck a cautious tone.
“It’s a win-win situation, but it must be tested,” he said. “We are looking for product availability and affordability. If we are looking for cheap fuel and driving everybody out of business, the product will not be available, and then prices will skyrocket.”
He warned that Dangote alone cannot meet national demand.
“As it is today, everybody is working with Dangote, and we know that Dangote cannot satisfy the country. So, there has to be a mix of product availability.”
The statement reflects an uneasy balance in the sector — between hope for self-sufficiency and fear of monopoly.
Public Opinion and Online Outrag
On social media, the announcement sparked fiery exchanges. Some users saw it as a patriotic step toward protecting Nigerian refineries; others saw it as economic suicide.
One user on X, @Rufyb, slammed the move:
“You got FX allocations at special rates to build your refinery and operate in a free trade zone, fine. Then produce and let others do their business. The market should decide what consumers want. Import tariff, because why?”
Another, @OpeBee, pointed out that the tariff comes just months before a 5 per cent fuel surcharge kicks in under the new tax act beginning January 2026.
“You raise the tariff on PMS by 15 per cent. There is also a 5 per cent surcharge next year, and people are defending this. The cascade of events to follow will be worse than importation.”
Yet some users applauded the decision. Tech entrepreneur @markessien called it “a good step” that would protect Nigeria’s emerging refining sector. “Nigeria has a working refinery and another being built. Imported fuel should have a tariff,” he wrote.
The debate online mirrors the one happening in boardrooms, filling stations, and government corridors: how much reform can Nigeria afford at once?
Behind the Curtain: The Dangote Factor
To many analysts, this policy cannot be understood without examining the influence of Aliko Dangote, Africa’s richest man and owner of the continent’s largest refinery.
When Dangote publicly hinted that the government’s new downstream policy would “strengthen the naira against the dollar,” few missed the implication. Within days, the tariff was announced — leading some to speculate that the measure was designed to shield his refinery from cheap imports.
While no evidence directly supports claims of collusion, the optics are difficult to ignore. The refinery, which began producing diesel and aviation fuel earlier this year, still operates below capacity and is expected to produce petrol in larger volumes by early 2026.
In the meantime, imported fuel remains the mainstay of the Nigerian market — and the new tariff could tilt the balance decisively in Dangote’s favour.
Energy Experts Weigh In
Energy analyst Olatide Jeremiah says the tariff will “inevitably” add about ₦100 per litre to fuel costs.
“This move will drive demand toward local refineries and increase government income,” he explained. “But it could also trigger short-term energy insecurity. Even top oil-producing nations import part of their fuel needs. Completely cutting off imports through high tariffs could expose the country to supply risks.”
He added that the measure should have been phased gradually, paired with social safety nets to cushion consumers.
“The danger is that people might perceive this as government policy favouring a few private players, rather than a national industrialisation drive.”
The Bigger Picture
According to FIRS data, Nigeria’s domestic refining output has risen slightly in the past year, with modular refineries in Edo, Rivers, and Imo states contributing marginally to supply. However, petrol imports still account for nearly 70 per cent of national demand, underscoring how far the country remains from true self-sufficiency.
Government officials insist the tariff is not permanent. Under Tinubu’s directive, the NMDPRA is expected to periodically review and scale down the duty as local capacity expands. But for now, the pain is immediate — and the benefits remain theoretical.
An Unfolding Experiment
The coming months will test whether Tinubu’s gamble pays off. If domestic refiners can scale up production quickly and sell at competitive prices, Nigeria could witness a rare success story in its long, troubled energy history.
But if they fail — or if importers retreat entirely — the country could face a crippling fuel shortage, and the ₦1,000-per-litre prophecy could become a grim reality.
For now, the queues at filling stations are shorter but the tension is palpable. Commuters whisper about new price hikes; market women complain about transport costs; and somewhere in Abuja, policymakers cling to the hope that this latest “reform” will finally deliver what decades of subsidies could not — a self-reliant energy sector.
Until then, Nigerians brace themselves, as another chapter of the nation’s endless fuel saga begins — one litre at a time.
Post a Comment