The Tinubu administration says it will sell petrol at cost through NNPC Limited’s filling stations for the next 30 days. The discount is aimed first at public transport operators, as authorities try to ease pressure on commuters and fares.
It is the clearest sign yet of a shift by an administration that for more than three years refused to cushion Nigerians from soaring fuel prices, insisting that the pain of reform would eventually pay off.
Finance minister Taiwo Oyedele announced the measure at a press conference in Abuja on Thursday. He insisted it was not a return to subsidies.
“It’s not a subsidy, government is just saying we sell to you at cost,” Oyedele said.
He also announced what he called price modulation. The government, he said, is negotiating a ceiling of ₦1,350 per litre on the ex-gantry or landing cost of petrol. When costs rise above that ceiling, refineries and importers will carry the shortfall and recover it later. The price will be reviewed monthly.
The government also plans forward sales of crude oil to domestic refiners, at a period and price yet to be determined.
The announcement is a sharp turn for a president who scrapped the petrol subsidy in his inauguration speech on May 29, 2023, and has repeatedly defended the decision, along with the liberalisation of the foreign exchange market, as necessary to fix longstanding distortions in the economy.
Petrol sold for about ₦185 a litre before the subsidy ended. The National Bureau of Statistics put the national average pump price at ₦1,596.25 a litre in May 2026, its most recent published reading.
The US–Iran war pushed prices up further. After the conflict broke out in February, Dangote Refinery raised its ex-gantry price from ₦774 to ₦1,075, and transport fares doubled on some major routes. Last month, pump prices rose above ₦1,400 per litre in several parts of the country after Dangote raised its gantry or depot price from ₦1,265 to ₦1,350.
The government initially argued that the savings from ending the subsidy were to go into infrastructure and social programmes. Nearly four years after, the government failed to make that investment and rather claims it passed the subsidy savings to state governors.
Falling inflation, rising poverty
The government has pointed to falling inflation as proof that its reforms are working. But part of the drop came from a change in how inflation is measured.
When the National Bureau of Statistics rebased the Consumer Price Index in January 2025, headline inflation fell from 34.8% in December 2024 to 24.48% in January 2025. The rebasing replaced a basket of goods based on 2009 with one based on 2023 and 2024, and the International Monetary Fund endorsed it as meeting international standards.
Headline inflation stood at 15.39% in August 2026, though food inflation remained at 19.57%. On the strength of those figures, the Central Bank of Nigeria cut its benchmark interest rate to 23% last month.
Lower inflation, however, only means prices are rising more slowly; it does not bring them back down. The World Bank put Nigeria’s poverty rate at 63% in 2025, saying household incomes had not grown fast enough to keep up with prices.
On the same day as Oyedele’s announcement, the World Bank warned that soaring food and transport costs are rapidly cancelling out the benefits of the reforms for millions of households. Mathew Verghis, its country director for Nigeria, said the challenge is to protect vulnerable Nigerians from “burning price pressures.”
The bank also flagged rising government spending ahead of the 2027 elections, warning it could weaken reform momentum and erode public support for the adjustment.
Political pressure
The timing reflects growing political pressure. Atiku Abubakar, the African Democratic Congress candidate, has promised to restore the subsidy.
Peter Obi of the Nigeria Democratic Congress, who campaigned for its removal in 2019 and 2023, told the BBC on Tuesday that he would bring it back if elected. “I’ll remove the corruption and retain the subsidy,” he said.
Obi’s campaign spokesman, Emmanuel Idakwo, argued that the government is already effectively subsidising petrol through what he called energy security costs running into trillions of naira a year. He challenged the government to say openly whether those payments count as a subsidy.
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