At N557 a litre, margin of petrol price increase widest in 30 years

The Nigerian National Petroleum Company Limited has confirmed increasing the price of petrol across the country.

The state oil firm said it was acting in response to “current market realities”, apparently referring to the removal of fuel subsidy announced by President Bola Tinubu on Monday.

“NNPC Limited wishes to inform our esteemed customers that we have adjusted our pump prices of PMS across our retail outlets, in line with current market realities,” company spokesperson Garba Muhammad said in a statement on Wednesday, referring to the product by the government-preferred name, Premium Motor Spirit.

– Why this matters

The removal of subsidy means the price of petrol will be determined by crude oil price and the cost of shipping refined product into Nigeria. Non-NNPC stations are likely to sell even higher.

“As we strive to provide you with the quality service for which we are known, it is pertinent to note that prices will continue to fluctuate to reflect market dynamics,” Mr Muhammad said.

Mr Tinubu’s announcement that “subsidy is gone” in his inaugural speech has already foisted hardship on Nigerians with petrol selling in some cities above N1000, from about N200.

The NNPC did not confirm its new pricing. It did not also confirm ownership of a price template for all state capitals circulating online, with rates between N488 to N557 a litre. In Abuja and Lagos, however, several NNPC stations sold petrol between N511 and N537 on Wednesday, up from N194.

The increase margin stands at 177%, the highest in 30 years. The only margin wider than the latest increase was in 1993 when petrol price rose from 70 kobo to N5 during the Shonekan administration, a 614%. It was later reduced to N3.50, still a record margin at the time.

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The subsidy policy has made life more difficult for citizens who mostly maintain the same income level and are already struggling with inflation which is at the highest level in 18 years.

The organized labour said they are opposed to the government removing subsidy without addressing critical issues such as refining fuel in Nigeria and the provision of support to the poor.

The president of the Nigeria Labour Congress, Joe Ajaero, said on Wednesday that the government had reached out for talks.