Petrol prices in Nigeria on Tuesday hit a historic high of 617 naira ($0.7802) per litre, marking the second consecutive month of price increases since President Tinubu abolished the popular yet expensive fuel subsidy in May.
According to a circular, prices were adjusted nationwide at fuel stations run by the state-owned Nigerian National Petroleum Co. Ltd. (NNPC), rising from 557 naira per litre.
Clement Isong, the head of the Major Oil Marketers Association of Nigeria (MOMAN), attributed the price hike to the escalating global oil prices and the exchange rate of the naira against the dollar.
Comprising Nigeria’s six largest fuel retailers, including the NNPC, MOMAN holds approximately one-third of the petrol market share.
As part of his extensive reforms to address various challenges, including Nigeria’s high debt burden, Tinubu has taken on the task of implementing the country’s most significant reforms in decades.
One of these reforms involved ending the long-standing fuel subsidy, which had maintained low fuel prices for many years but had become increasingly costly. Last year alone, the fuel subsidy amounted to a staggering $10 billion in government expenses.
After its termination, a total of 56 private firms have obtained licenses for petrol importation.
Among them, 10 companies are set to provide supplies in the third quarter, thereby putting an end to NNPC’s import monopoly. Previously, NNPC held exclusive rights as the sole importer of petrol through crude swap contracts.
“Out of these 10, three of them have already landed cargoes … and others are also indicating interest to import in August and September,” Farouk Ahmed, head of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), said in a statement.
Due to insufficient refining capacity and neglect of existing refineries, Nigeria, the largest oil producer in Africa, relies heavily on imported refined fuel, importing nearly all of its fuel requirements.