Imports Are Not the Enemy: Why Nigeria’s Downstream Stability Depends on Regulation, Not Sentiment

It is important to state clearly that the pricing stability being observed in Nigeria’s downstream petroleum sector today is not accidental. It is largely the product of active, disciplined regulation by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).

Without regulation, stability would be illusory.

Imagine a downstream system entirely dependent on a single domestic supplier in the name of local refining, with no balancing mechanism and no competitive pressure. In such a scenario, prices would not be discovered by the market; they would be dictated. Any upward adjustment by that supplier would transmit instantly to consumers, with no buffer and no alternative source of supply. That is not energy security. It is vulnerability.

Yet this is the central issue often ignored in the current debate.

Do Nigerian refineries deserve protection? Yes.
Does Nigeria deserve insulation from domestic supply shocks? Absolutely.
Is regulation essential in a strategic industry like downstream oil and gas? Without question.

But policy must confront facts, not sentiment.

Can current domestic refining meet national demand today? No.
Can it guarantee even fifteen days of uninterrupted nationwide supply? No.

These are not opinions. They are capacity realities.

The unavoidable question, therefore, is this: how do you ensure price stability and product availability when domestic supply does not meet national demand?

The answer is imports.

Nigeria operates an open market economy. In such a system, domestic refiners and importers are subject to the same economic arithmetic. If any player sells below the true market price, they are deliberately absorbing losses. That approach is temporary by nature. It is not efficiency; it is attrition. The objective is simple—force competitors out, then reset prices upward once alternatives disappear.

Downstream pricing is not opaque. It is among the most transparent markets globally. Refining margins, freight rates, insurance, port charges, financing costs, and foreign exchange exposure are all benchmarked and publicly accessible. Anyone can compute landing costs. Anyone can identify artificial pricing.

That is precisely why regulation matters.

Consider Nigeria’s telecommunications sector without the Nigerian Communications Commission (NCC). We would not be debating marginal tariff adjustments today; we would be confronting multiples of current prices. Yet no one argues that regulation should exist solely to favour incumbent local operators, despite their massive capital investments. Why? Because doing so would stifle competition, deter future investment, and ultimately harm consumers.

The same logic applies to downstream petroleum.

Protect infrastructure. Safeguard supply. Regulate transparently. But do not distort the market under the illusion of protectionism. When regulation becomes selective, investment retreats. When investment retreats, supply contracts. When supply contracts, prices rise.

The objective is not to choose between domestic refining and imports. The objective is to bridge the gap between supply and demand without creating scarcity, instability, or investor flight.

Until domestic refining can reliably meet national demand at scale, imports are not a threat.

They are a stabiliser.

That is not ideology.
That is economics..

A New Dawn for Nigerians: Dangote Slashes Petrol Price to ₦699/Litre.

By George Omagbemi Sylvester | Published by saharaweeklyng.com

“A Strategic Breakthrough in Economic Relief and Energy Sovereignty.”

In a momentous development poised to reverberate across Nigeria’s economic and social landscape, Dangote Petroleum Refinery has officially reduced the ex-depot price of Premium Motor Spirit (PMS), commonly referred to as petrol, to ₦699 per litre, effective December 11, 2025. This significant reduction (from the previous gantry price of ₦828 per litre) marks a ₦129 drop, representing an approximate 15.58% decrease and stands as one of the most impactful fuel price adjustments of the year.

This landmark shift in pricing is more than a headline, it is a decisive blow to the entrenched pain point in the daily lives of Nigerians. For years, the spiralling cost of petrol has been cited as a catalyst for inflationary pressures, high transportation costs, and widespread hardship for ordinary citizens. Now, with petrol costing significantly less at the gantry, the potential for broader socio-economic relief cannot be overstated.

A Strategic Shift in Nigeria’s Fuel Economy. To fully appreciate the significance of this price cut, it is essential to contextualise its broader implications:

1. A Shift from Import Dependence to Local Refining

Nigeria though one of Africa’s largest crude oil producers has historically relied heavily on imported refined petroleum products, losing billions of dollars annually in foreign exchange expenditures. The result has been volatile prices, supply uncertainties, and an economy tethered to the whims of global markets.

The Dangote Refinery, with a refining capacity of 650,000 barrels per day, was constructed precisely to break this cycle of dependence. By locally refining crude oil into marketable petroleum products, the refinery represents a monumental step towards energy sovereignty, reducing foreign exchange outflows and stabilising domestic fuel availability.

Indeed, industry insiders have repeatedly pointed out that local refining should lead to more stable and affordable pricing over time, barring market distortions and distortive practices within the downstream sector.

Economic Relief: What ₦699 Means for Nigerians

For the average Nigerian commuter, trader, farmer, and small business owner, daily life is inextricably linked to the cost of fuel. Transport costs dictate the price of goods, and fuel affordability directly affects disposable income for millions.

Immediate Consumer Impact. Lower Gantry Cost: With the refinery selling petrol at ₦699 per litre, there is immediate potential for retail stations to offer petrol at significantly lower pump prices. Already, indications suggest that in Lagos, petrol may retail around ₦740 per litre, though final prices will vary across states and retailers.

Market Reaction: Private depots in key markets like Lagos have already responded to the competitive pricing environment by reducing their own ex-depot prices (in some cases to as low as ₦710 per litre) a direct ripple effect of Dangote’s pricing strategy.

Macro-Economic Implications. The reduction in gantry price can result in downward pressure on inflation. Transport operators, armed with access to cheaper petrol, may recalibrate their freight and passenger fares, offering relief to consumers and curbing cost-push inflation pressures commonly observed when fuel prices surge.

Furthermore, as fuel prices correlate with the cost of logistics, cheaper petrol can contribute to lower food prices, easing hunger and reducing the strain on household budgets.

Stakeholder and Expert Perspectives. The move has elicited wide commendation from industry experts and former policymakers who view it as a welcome relief to millions of Nigerians.

Citing Financial and Economic Expertise

Titus Okunronmu, a respected former Director of the Research Department at the Central Bank of Nigeria (CBN), hailed the price reduction as “a welcome development that would bring significant relief to millions of Nigerians.” He emphasised that a persistent downward review of petrol prices (of which this is one of many) strengthens market stability and consumer confidence.

Such expert assessments underscore the broader positive externalities of the price cut (beyond mere cost savings) into market confidence and economic stability.

Market Dynamics: Competition, Losses, and Strategic Disruption

While the reduction is a boon for consumers, it challenges established market actors and particularly petrol importers who have traditionally dominated Nigeria’s fuel supply chain.

Industry reports indicate that this aggressive pricing strategy by Dangote’s refinery may be inflicting substantial financial strains on independent marketers and importers, with estimated monthly losses in the region of ₦102 billion due to compressed margins as a result of Dangote’s competitive pricing.

Such a profound market shift is not just a pricing decision; it is a strategic disruption of a sector long dominated by import-heavy players commanding higher retail prices.

Dangote’s Strategic Vision and Nigeria’s Energy Future

Aliko Dangote (Africa’s richest businessman and the visionary behind the refinery) has reiterated the company’s steadfast commitment to ensuring that Nigerians are the primary beneficiaries of local refining capacity. He has highlighted that despite challenges from vested interests and resistance from some import-centric stakeholders, the refinery’s mission is to stabilise fuel supply, improve quality, and ensure competitive pricing.

Dangote’s rhetoric underscores a broader belief: Nigeria does not merely need a refinery; it needs a fuel system that prioritises citizens over profit margins skewed by imported pricing dynamics.

In his own words during a recent press engagement, Dangote stressed that “Nigerians have a choice: to buy better-quality fuel at an affordable price, or to buy blended PMS at a higher rate. Importers can continue to lose, as long as Nigerians benefit, I am happy.”

This declaration, bold and unapologetic, signals an embrace of market competition as a means of benefitting the populace with a refresher in corporate responsibility that aligns profit with the national interest.

Challenges on the Horizon. While this fuel price reduction is transformative, significant challenges remain:

Retail Pass-Through: Ensuring the gantry price reduction is fully and transparently reflected at petrol stations nationwide is not guaranteed. Logistics, retailer mark-ups, and regional cost variances may dilute the intended benefits.

Distribution Infrastructure: Nigeria’s vast geography and uneven distribution networks mean that urban centres like Lagos may see benefits sooner than rural regions.

Regulatory Uncertainties: Downstream regulatory frameworks, including tariff structures and import levies, continue to shape fuel pricing dynamics.

Nevertheless, this strategic pricing adjustment by a private refinery in a deregulated market signals renewed competition and a poignant counter-narrative to decades of import-dependent pricing. It throws a spotlight on the potential for domestic energy infrastructure to redefine national economic performance.

Final Word: A Pivotal Moment of Relief and Hope

Dangote Petroleum Refinery’s reduction of petrol’s ex-depot price to ₦699 per litre is far more than a numerical adjustment, it represents a tectonic shift in Nigeria’s fuel economy. It is a strategic blow against inflationary pressures, a relief for the struggling masses, and a rebuke of import-heavy pricing models that have long burdened the Nigerian economy.

As Nigerians watch this development unfold at the petrol pump and in the wider economy, one thing is clear: this is not merely a price cut, it is a clarion call for structural transformation in Nigeria’s energy sector.

In the words of one economic expert: “Relief does not come from rhetoric; it comes from tangible impacts on people’s lives.” With petrol now priced at ₦699 per litre, that relief may finally be here.

*MAKING THE OIL AND GAS SECTOR WORK FOR CITIZENS: NUPRC RESCUE MISSION*

By James Itodo

The Nigerian oil and gas sector, since its discovery, exploration, and exploitation at the turn of the century, has become the goose that lays the golden egg, likened only to the much-sought-after bride.

This is because oil, and later gas, remained the main economic sustainer, accounting for virtually all the revenue utilised for the economic sustainability and stability of the country—a nation driven by a monolithic economy.

Various attempts at sustaining its viability failed because those reforms lacked the necessary ingredients and the political will of their drivers to succeed. Moreover, the temptation of the enormous amounts generated, and the ease of generating this revenue, became stronger than the moral responsibility and patriotic devotion of the country’s leaders, causing various rulers to rely completely on oil while abandoning or ignoring agriculture and every other means of generating revenue, including all forms of diversification and integration.

The present Nigerian Upstream Petroleum Regulatory Commission (NUPRC) was born out of necessity: first, to inherit the abnormalities of the past; and second, to set in motion reforms aimed at effectively repositioning the sector. Key among these is strong political will and the appropriate sensitisation of the country’s political leaders to look beyond oil and gas revenue and think towards diversification.

To carry this out effectively, there is a need to build trust and confidence on the fulcrum of accountability and transparency.
So far, the verdict has been positive. The basic recipe for repositioning and bringing about a volte-face in the sector is now present: accountability and transparency.

A new era, based on a better concept of transparency and accountability, is enhancing the effective repositioning of the Nigerian oil and gas sector, which will work for the overall benefit of all citizens and indeed residents.

Today, Nigerians are now seeing the oil and gas sector as a blessing, with transparency and accountability becoming the fulcrum of operations at the NUPRC.

There is no doubt that, for decades, Nigeria’s oil and gas sector was a cesspit of abhorrent and odious corruption, coupled with mismanagement—a centre of graft, earning the moniker “resource curse.”
Instead of bringing blessings to the country, it became an avenue for self-aggrandisement and self-enrichment at the detriment of national interest, economic growth, prosperity, and development.

As a whole, the sector’s opacity and lack of accountability led to widespread corruption, where the few who had access to this national wealth enriched themselves and their families—buying choice houses at highly exorbitant prices in prime cities of the world and sending their children to schools abroad on ear-splitting school fees, all with our common patrimony—at the expense of the country. This resulted in environmental degradation and human rights abuses, leaving citizens with little to show for the country’s vast oil resources, world oil production status, and its derived and associated wealth.

However, a new dawn has emerged with the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) leading a rescue mission to reposition the sector with renewed vigour, intentionality, and patriotic commitment under the leadership of Engr. Gbenga Komolafe, who has turned the NUPRC into a beacon of hope for Nigerians.
Unambiguously, the NUPRC’s commitment to transparency is demonstrated through its proactive disclosure of key industry data—which had previously been shrouded in obscurity—including production figures, revenue streams, and contract awards.

The demystification and openness of this key information have greatly enhanced the fostering of trust and confidence among stakeholders, including local communities, civil society organisations, and international partners.
Another signature reform is the strengthening and implementation of the Nigeria Extractive Industries Transparency Initiative (NEITI), which ensures that oil and gas revenues are transparently tracked and accounted for, thereby reducing corruption and ensuring that revenues are channelled for the overall benefit of all citizens.

Projecting the ideals of the Renewed Hope Agenda of the Tinubu-led administration, the NUPRC has also prioritised increased utilisation of local content development, bringing on board many more Nigerian companies to participate in the oil and gas value chain, thereby creating more jobs, stimulating economic growth, and empowering local communities.

The sector’s transformation is an unequivocal demonstration of the power of transparency and accountability.
Daily, Nigerians are beginning to see oil and gas resources as a direct blessing rather than a curse, with a sector and operators poised to drive economic growth, create jobs, and improve living standards.

However, this is just the beginning; the journey is far from over, and the best is yet to come—for all of us.
While Nigerians holistically embrace these reforms, they must also continue to demand transparency and accountability from their leaders, while the NUPRC’s efforts must be supported and sustained to ensure that the sector remains a catalyst for national development.

There is no doubt that the oil and gas sector can be a powerful catalytic tool for poverty reduction, wealth creation, and economic transformation. This can be imminently and necessarily achieved when the NUPRC continues in its commitment to transparency and accountability, predicated on the resilience of Nigerians, who will look forward to a brighter future where their natural resources work for them, not against them.

It must be a collaborative and conscientious responsibility of all Nigerians not only to support the NUPRC’s efforts and reforms targeted at transforming the oil and gas sector but also to demand consistent transparency and accountability from our leaders, as this will ensure that our natural resources benefit all Nigerians, securing a brighter future for Nigeria and Nigerians.

Itodo writes from Abuja