analysis

Fuel Prices in Nigeria, and What Nigerians Did About Them

Petrol has been deregulated since May 2023, which is why there is no single national price. Where the official numbers come from, what changed in the market, and the behavioural response nobody has measured.

NigeriaPolls Research Desk1 October 202610 min read

WA 𝕏 in f

In short

Petrol in Nigeria has been deregulated since the subsidy was withdrawn at the end of May 2023, immediately after President Bola Tinubu's inauguration. Before that the pump price was held well below the landing cost by a federal subsidy; since then it has been set by marketers, which is why it varies by state, by station and by week rather than sitting at one national number.

Two further changes matter. The Dangote refinery began producing petrol in September 2024, which for the first time gave the domestic market a large local source rather than near-total reliance on imported refined product. And NNPC Ltd stopped being the de facto single price-setter, so the question "what is the price of fuel in Nigeria" now has a range as an answer rather than a figure. The National Bureau of Statistics publishes average pump prices by state, which is the closest thing to an authoritative series.

The part nobody publishes is what households and small businesses actually did in response. Not what they say about it, which is uniformly negative, but what specifically changed: journeys dropped, generator hours cut, routes switched, prices passed on, staff let go, businesses closed. That is measurable and it is not being measured at scale.

Why there is no single price

Before deregulation the answer was simple, because the price was administered. A subsidy absorbed the difference between the landing cost of imported petrol and a politically set pump price, so the number was the same almost everywhere and changed only when policy changed.

Deregulation replaced that with a market, and markets produce ranges. What determines the price at a particular pump now:

The landing or refinery-gate cost. For imported product that is the international price plus freight plus the exchange rate, and the exchange rate is the dominant variable. For domestically refined product it is the refinery's gate price. Either way the naira cost of crude and of dollars moves the floor.

Distance from the depot. Haulage from the coast to the North East costs considerably more than haulage within Lagos, and that difference shows up at the pump. Northern and north-eastern states consistently show higher average prices in the NBS state series for this reason alone.

Local competition. A town with several stations prices differently from a town with one.

Marketer margin and station economics. Independent stations, major marketers and NNPC retail outlets do not carry the same cost structure.

Availability. When supply tightens, queues form and informal premiums appear, including the black-market sale that costs several times the pump price.

The consequence worth internalising: a single national petrol price quoted in a headline is an average of a wide distribution. The spread between the cheapest and most expensive states in a given month is large enough that the average describes neither.

Where to find the real numbers

National Bureau of Statistics. Publishes average retail prices for petrol, diesel, kerosene and cooking gas, by state and nationally, on a monthly cadence. This is the authoritative public series and the one to cite.

NNPC Ltd and the major marketers. Publish or display their own pump prices, which tell you what one operator charges rather than what the market does.

NUPRC and NMDPRA. The upstream and midstream/downstream regulators under the Petroleum Industry Act, for volumes, licensing and regulatory detail.

Central Bank of Nigeria. For the exchange rate, which is upstream of everything else in the chain.

Anything else, including the figures that circulate on social media during a price move, should be treated as a claim until it traces to one of these.

What changed in the market since 2023

Three structural shifts, in order of consequence.

Subsidy withdrawal

The subsidy was a very large federal expenditure and its removal was the single largest change in Nigerian consumer prices in recent memory, because petrol is an input to almost everything. Transport fares moved first, then food, because food moves by road.

The second-order effects are the ones that are poorly documented. A trader whose haulage cost doubles either raises prices, reduces volume, or absorbs it and shrinks. Which of those happened, in which categories and which regions, determines who actually bore the cost, and it has not been systematically established.

Local refining

The Dangote refinery's entry into petrol production in September 2024 changed the structure of supply. A domestic source reduces exposure to international freight and shortens the chain, and it introduces a domestic pricing reference where previously there was only an import parity calculation.

It does not automatically mean cheaper petrol, because a commercial refinery prices against the alternative, and crude feedstock is bought at international prices whether it is refined in Lekki or in Rotterdam. The effect on retail prices is an empirical matter rather than a logical consequence.

Generators and the power question

Petrol and diesel prices in Nigeria are partly an electricity story, because a very large number of households and almost every small business runs a generator for some part of the day. When fuel prices rise, the cost of electricity rises for anyone self-generating, which is a different transmission mechanism from the transport one and hits different businesses.

This is one of the clearest examples of a question that only fieldwork answers. How many generator hours a business cut, what it did with the hours it lost, and whether it raised prices or reduced output, cannot be derived from a fuel price series.

The questions nobody is answering

A reasonably complete list of what remains unmeasured at national scale:

Journey reduction. How many trips households stopped making, which ones, and what they gave up by not making them. School attendance, clinic visits and market trips are the ones with consequences.
Mode switching. Who moved from private car to shared transport, from shared transport to walking, and over what distances.
Fare pass-through. How much of the fuel increase commercial transport passed to passengers, how fast, and whether it has since stuck.
Generator behaviour. Hours cut, by household and by business type, and what the resulting output loss was for small enterprises.
Business survival. How many small businesses in fuel-intensive categories reduced staff, reduced hours or closed, and in which states.
Food price transmission. How much of food inflation in a given corridor traces to haulage cost rather than to production, which requires measurement along specific routes.
Informal market activity. The share of purchases happening outside licensed stations during supply tightness, and at what premium.
Who absorbed it. Across the chain from producer to trader to consumer, who actually paid, which is the question that determines whether a policy was regressive and by how much.

Each of these is a survey or a route study. None of them is technically difficult. They are absent because nobody has commissioned them, and in their absence the public debate about deregulation is conducted almost entirely on assertion by people who are certain and unevidenced on both sides.

How to read a fuel price claim

Which product? Petrol, diesel, kerosene and cooking gas have different markets, different buyers and different price paths. They get conflated constantly, and a diesel figure quoted as "fuel" misleads about household costs while a petrol figure quoted as "fuel" misleads about business costs.

Where, and when? A state and a month, because a national average in a deregulated market with large haulage differentials describes no particular pump.

Pump price or street price? During a shortage these diverge sharply, and the number that matters to a buyer is the one they actually paid.

Average of what? The NBS series is an average of surveyed stations with a stated method. A number with no method behind it is a sample of one.

Nominal or real? A price rise during a period of general inflation is partly a general price rise. Both facts are true and only one is usually reported.

Is a behavioural claim attached? "Nigerians have cut back on travel" requires a sample size, a geography, a date and a question wording. Without those four it is a sentence with a percentage.

What a proper study looks like

If the aim is to establish what deregulation actually did to households and small businesses, the design is reasonably well defined.

A household panel, sized for state-level reporting rather than a national headline, measuring journeys made in a short recall window, mode used, fares paid, generator hours run, and the specific things given up.
A small-business sample in fuel-intensive categories, measuring generator hours, output, pricing decisions, staffing and closure risk, with enough base per category to report them separately.
Route-level haulage measurement on the corridors that actually carry food, so that food price changes can be attributed between production cost and transport cost rather than guessed at.
Repetition on a fixed cadence, because the interesting finding is not the level at any moment but the direction and who it is moving against.
Published questionnaire and base sizes, so that every number can be checked by the person reading it.

That is the programme. The reason the argument about fuel prices in Nigeria never resolves is not that the evidence is hard to gather. It is that nobody is gathering it.

Frequently asked questions

Is petrol still subsidised in Nigeria?

No. The petrol subsidy was withdrawn at the end of May 2023, immediately after President Bola Tinubu's inauguration, and the market has been deregulated since. Before that, a federal subsidy absorbed the difference between the landing cost of imported petrol and an administered pump price, which is why the price was uniform nationally and only changed when policy changed.

Why does the price of fuel differ from state to state in Nigeria?

Because the market is deregulated and the costs differ. Haulage from the coastal depots to the North East is considerably more expensive than distribution within Lagos, so northern and north-eastern states consistently show higher average pump prices. On top of that, local competition, marketer margins, station cost structures and local availability all vary. The National Bureau of Statistics publishes average pump prices by state, which shows the spread directly.

Where can I find the official price of fuel in Nigeria?

The National Bureau of Statistics publishes average retail prices for petrol, diesel, kerosene and cooking gas, nationally and by state, on a monthly cadence. That is the authoritative public series. NNPC Ltd and the major marketers publish their own pump prices, which tell you what a single operator charges rather than what the market does. NUPRC and NMDPRA cover regulatory and volume data.

Did the Dangote refinery reduce petrol prices in Nigeria?

The refinery began producing petrol in September 2024, which gave the domestic market a large local source rather than near-total reliance on imported refined product, shortening the supply chain and introducing a domestic pricing reference. Whether that translates into lower pump prices is an empirical question rather than an automatic consequence, because a commercial refinery prices against its alternatives and buys crude feedstock at international prices wherever it is located.

How did fuel price increases affect food prices in Nigeria?

Food in Nigeria moves by road, so haulage cost is a direct input into food prices, and transport fares moved before food prices did after deregulation. What has not been established is how much of food inflation in any given corridor traces to haulage rather than to production costs, because that requires route-level measurement on the corridors that actually carry food. Without it, the attribution is guesswork in both directions.

Why do fuel prices matter for electricity in Nigeria?

Because a very large number of households and almost every small business self-generates power for part of the day. When petrol and diesel prices rise, the effective cost of electricity rises for everyone running a generator, which is a separate transmission mechanism from the transport one and affects different businesses. How many generator hours were cut, and what output was lost as a result, is not captured by any price series.

What is not known about the effect of fuel deregulation?

Almost all of the behavioural response. How many journeys households stopped making and which ones, who switched transport mode, how much of the increase commercial transport passed to passengers, how many generator hours businesses cut and what output they lost, how many small businesses reduced staff or closed, how much of food inflation came through haulage, and ultimately who across the chain absorbed the cost. Each is answerable through survey or route study and none has been measured at national scale.

How should the impact of fuel prices be measured?

Through a household panel sized for state-level reporting that records journeys made in a short recall window, mode, fares, generator hours and what was given up; a separate sample of small businesses in fuel-intensive categories covering generator hours, output, pricing and staffing; route-level haulage measurement on the corridors that carry food; and repetition on a fixed cadence so direction can be read rather than a single level. The questionnaire and base sizes should be published with the findings.