FG Defends Fuel Price Fluctuations, Blames Market Forces

FG Defends Fuel Price Fluctuations, Blames Market Forces

  • Business
  • March 8, 2026
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ABUJA — The Federal Government has defended the recent fluctuations in petrol pump prices across Nigeria, attributing the changes to prevailing market forces under the country’s deregulated petroleum sector.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) said the changes in fuel prices seen in cities such as Abuja and Lagos are normal developments in a fully deregulated downstream petroleum market.

The clarification follows growing public concern over the rising cost of petrol at filling stations after several marketers adjusted their pump prices in recent days.

Market Forces Driving Prices
Speaking on the development, NMDPRA spokesperson George Ene-Ita explained that petrol prices are now determined by economic factors such as international crude oil prices, exchange rate movements, and logistics costs within the supply chain.
He noted that since the government adopted a deregulated petroleum pricing system, retail fuel prices are no longer fixed by government agencies but reflect global and domestic market realities.

“Nigeria has been operating a fully deregulated downstream petroleum regime since the inception of the current administration. Pump price movements are therefore a reflection of prevailing market dynamics,” Ene-Ita said.

Global Oil Market Influence
Energy analysts say volatility in global oil markets is also contributing to price adjustments in Nigeria.

International oil benchmarks such as Brent Crude and West Texas Intermediate have recently recorded price increases amid geopolitical tensions in the Middle East, raising concerns about potential disruptions in global energy supply.

Because Nigeria’s petroleum supply chain is closely tied to the international market, such developments often influence domestic petrol prices.

NNPCL and Refinery Adjustments
Meanwhile, the Nigerian National Petroleum Company Limited (NNPCL) has adjusted pump prices at several of its retail outlets, with petrol now selling for about ₦960 per litre in Abuja.

The change followed similar adjustments in wholesale supply prices, including an increase in gantry price by the Dangote Petroleum Refinery, which reportedly raised its price by about ₦100 per litre.
Industry experts say increases at the wholesale level often lead to higher retail prices as marketers attempt to maintain operational margins.

Retailers Raise Concerns
Fuel retailers have acknowledged that price fluctuations are now a structural feature of Nigeria’s deregulated petroleum market.
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) warned that frequent adjustments in pump prices could impact transportation costs and contribute to rising inflation across the country.

However, the association noted that deregulation is expected to attract investment into refining, storage, and distribution infrastructure in the long term.

Implications for Consumers
For Nigerians, the deregulated system means petrol prices will increasingly respond to global oil prices, exchange rate conditions, and domestic supply factors.

Energy economists believe that although the system may result in short-term price volatility, increased refining capacity — particularly from large-scale facilities like the Dangote refinery — could eventually help stabilize supply and moderate price swings.