The Federal Government has unveiled fresh measures to cushion Nigerians against rising petrol prices and the impact of global crude oil market volatility, with the Nigerian National Petroleum Company Limited (NNPC) agreeing to forgo its retail profit margin and sell petrol at cost for the next 30 days.
The initiative, backed by President Bola Tinubu, is part of a broader package announced by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, to protect vulnerable households and businesses from rising energy and transportation costs.
According to a statement issued by presidential spokesman, Bayo Onanuga, the arrangement means NNPC Retail will sell petrol without adding its usual retail profit margin during the 30-day period.
For instance, if the company’s landing cost is N1,300 per litre, it will sell at the same price, with particular consideration for commercial transport operators and other consumers affected by rising fuel costs.
Oyedele expressed hope that other fuel marketers would adopt similar measures, noting that the sharp increase in crude oil and petrol prices was not expected to persist indefinitely.
He, however, cautioned against interpreting the NNPC’s decision as a return to petrol subsidy, which the Tinubu administration ended on May 29, 2023.
The minister said the government was pursuing measures to moderate price fluctuations and ease the burden on households without reinstating the subsidy regime.
As part of the package, the government is negotiating a ceiling of N1,350 per litre on petrol’s ex-gantry or landing cost to help stabilise pump prices.
Under the proposed arrangement, refiners and importers would absorb costs exceeding the ceiling and recover the shortfall later when crude oil prices or exchange rates improve, subject to the agreed framework.
Oyedele said the arrangement was neither a subsidy nor price control but a mechanism for smoothing price movements over time.
He explained that maintaining relatively stable prices would give households and businesses greater certainty than allowing sharp increases followed by subsequent reductions, particularly because transport fares often rise quickly but fall more slowly.
The minister added that the ceiling would be reviewed monthly and adjusted when necessary, with the relevant figures published to promote transparency.
The Federal Government is also pursuing forward crude oil sales to domestic refineries. According to Oyedele, rising production and the release of previously committed crude supplies are expected to improve domestic availability and reduce the exposure of petrol prices to global market volatility.
Other measures include stricter enforcement against road taxes and levies that increase transportation and logistics costs. The government said it would work with state governments and security agencies to curb such charges under the 2025 tax reform laws.
The government is also increasing funding for cash transfers to vulnerable households and expanding access to subsidised credit for small businesses and consumers.
On transportation, Oyedele said the Federal Government was accelerating the deployment of compressed natural gas (CNG) vehicles in partnership with state governments.
He said CNG was 60 to 70 per cent cheaper than petrol and expressed the expectation that transport operators would pass the savings on to passengers through lower fares.
The package also includes plans to consider an excess-profit tax on operators found to be taking undue advantage of consumers across the energy value chain.
According to the government, revenue from any such tax would be devoted exclusively to cushioning the impact of high fuel prices through transport support or vouchers for urban minimum-wage earners and other vulnerable groups.
The Federal Government also plans to work with the National Assembly to consider additional tax relief for low-income earners under the 2027 Finance Bill.
Other interventions include reducing regulatory bottlenecks and compliance costs that contribute to higher business expenses and, ultimately, the prices of goods and services.
The government is also investing in a National Strategic Fuel Reserve to protect households and businesses against future energy supply disruptions.
Under the proposed framework, refined petroleum products would be released into the market under clear, published rules whenever global disruptions or hoarding threaten supply and price stability.
Oyedele said the reserve would not operate as a subsidy or a price-fixing mechanism but would help prevent artificial scarcity, discourage market manipulation and moderate price volatility.
The latest interventions come amid concerns over the impact of rising international oil prices on domestic fuel costs, transportation, food prices and the general cost of living.
The government said the measures were designed to provide relief to vulnerable Nigerians, contain inflationary pressures and improve economic stability without reversing the removal of petrol subsidy.
