The Nigerian National Petroleum Company Limited (NNPCL) has increased the pump price of Premium Motor Spirit (PMS) at its retail outlets in Abuja to N960 per litre, up from N875, following a surge in global crude oil prices driven by escalating geopolitical tensions in the Middle East.
Checks conducted by Nairametrics at several NNPCL stations in the Federal Capital Territory on Tuesday confirmed the upward adjustment, with petrol selling at N960 per litre, compared to N875 per litre on Monday.
The development follows a similar increase by Dangote Petroleum Refinery, which raised its gantry price by N100 on Monday, bringing the ex-depot rate to N874 per litre from N774. Together, these moves have raised concerns over further fuel price hikes across Nigeria.
What the data is saying
The increase in domestic fuel prices comes amid sharp rises in global crude oil benchmarks, triggered by Middle East hostilities.
- Brent crude futures surpassed $80 per barrel on Monday and are currently trading at around $84.2 per barrel.
- The escalation followed joint US-Israeli strikes on Iranian targets, reportedly resulting in the death of Iran’s Supreme Leader, Ayatollah Khamenei.
Iran has retaliated by targeting US military bases and interests across the Middle East, including the UAE, Qatar, Bahrain, and Saudi Arabia.
The disruption to global supply chains has driven international oil prices higher, creating upward pressure on domestic PMS rates.
More Insights
The rising fuel costs have mixed implications for Nigeria’s economy:
- Higher crude oil prices could increase government revenue from oil exports.
- Rising PMS prices, however, are expected to put additional pressure on inflation and household purchasing power.
Industry analysts warn that sustained geopolitical tensions could push crude oil prices beyond $100 per barrel, further impacting domestic pump prices.
The developments highlight the vulnerability of Nigeria’s fuel market to global energy shocks and geopolitical risks.
Petroleum marketers under the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) have expressed concern over the situation.
- Dr. Billy Gillis-Harry, PETROAN National President, told journalists in Abuja that the ongoing Middle East conflict could significantly disrupt global energy markets and supply chains.
- He noted that any sustained increase in global crude prices would inevitably be reflected in higher retail prices at petroleum outlets across Nigeria.
PETROAN warned that continued volatility in crude prices would further strain consumers and businesses already grappling with economic challenges.
What you should know
With no immediate resolution in sight for the Middle East conflict, domestic fuel prices are likely to remain vulnerable to further upward adjustments in the coming weeks.
In January, Nairametrics reported that NNPC Limited had increased the pump price of petrol to N839 per litre in Abuja.
