Nigeria’s federal government says it will not intervene to regulate petrol prices despite rising volatility in global oil markets triggered by the escalating conflict in the Middle East.
Speaking during a television interview on Wednesday, Finance Minister Wale Edun said the government would instead introduce measures aimed at cushioning the economic impact of the war involving the United States, Israel and Iran.
Edun said Bola Tinubu had already announced plans to provide an additional 100,000 compressed natural gas conversion kits to help motorists switch from petrol to CNG, which costs about 25 to 30 percent of the price of petrol.
According to the minister, the government prefers market-driven solutions rather than direct price control.
“When there is market failure, that is where the regulator steps in. But in terms of balancing pricing, what we are looking to do is to manage the disruption, and we do not know how permanent or temporary it could be,” Edun said.
“But in the meantime, rather than reverting and taking backward steps, we will look at every other measure that we have that can help reduce the cost of living of Nigerians.”
The conflict in the Middle East has triggered sharp fluctuations in global energy markets, with crude oil prices briefly rising above 100 dollars per barrel on March 9, their highest level since July 2022, before easing to about 87 dollars the following day.
Earlier, the finance ministry warned that the conflict could affect Nigeria’s crude oil and gas prices, capital flows in financial markets, as well as global logistics and supply costs.
The surge in crude prices has also pushed up ex-gantry petrol prices, with many retail stations across Nigeria increasing pump prices. The development has led to higher transport fares on several major routes.
Edun said price adjustments by private sector operators reflect prevailing market conditions, citing developments at the Dangote Refinery.
The refinery recently reduced its ex-gantry petrol price to about 1,075 naira per liter after implementing three earlier increases, although retail pump prices remain elevated.
“Dangote reduced their price from around 1,200 naira to now just over 1,000 to 1,050 naira, and that is the dynamics of the market,” the minister said.
He added that Nigeria’s growing refining capacity is strengthening the country’s economic resilience, pointing to investments by Aliko Dangote, president of the Dangote Group.
“But I think we should be thankful at this time for the capacity we have in Nigeria to refine crude into petrochemicals and petroleum products,” Edun said.
He noted that several countries without domestic refining capacity are facing greater economic disruption as energy prices rise.
Edun stressed that Nigeria must continue to support local refiners to ensure stable supply of petroleum products.
Meanwhile, the African Democratic Congress has urged the federal government to introduce a temporary cap on petrol prices to prevent further increases that could worsen the cost of living crisis.
