Nigerians may soon face another round of fuel scarcity and potential price hikes, with petrol prices possibly rising to N1,000 per litre, as escalating tensions in the Middle East and an internal tanker drivers’ strike threaten the country’s fragile fuel distribution system.
Amid these fears, Dangote Petroleum Refinery on Sunday launched a fleet of 4,000 new Compressed Natural Gas (CNG)-powered tankers to begin nationwide distribution of Premium Motor Spirit (PMS) and diesel from August 15, a move aimed at reducing distribution costs and easing logistical bottlenecks.
However, the rollout comes at a time of serious pushback from existing fuel haulage operators. The Nigerian Association of Road Transport Owners (NARTO) has announced its withdrawal from lifting petroleum products from the refinery, citing unresolved issues with the Lagos State Government’s E-Call Up system and rising operational costs.
The brewing crisis, compounded by geopolitical developments abroad, is heightening fears of disruption in petroleum product availability, especially in Lagos and other major cities.
Export Decline, Middle East Tension Fuel Supply Fears
Adding to the challenges is a decline in Nigeria’s crude oil exports. According to the National Bureau of Statistics (NBS), crude oil exports dropped by 16.34% to ₦12.96 trillion in Q1 2025, down from ₦15.49 trillion in Q1 2024. The figure also fell short of Q4 2024’s ₦13.78 trillion.
This decrease reinforces concerns that local refineries may have to increase fuel imports, exposing the domestic market to further price shocks and logistics complications, especially amid growing global tensions.
Last week, Iran launched missile strikes against Israel, triggering global crude price surges of over 10%, with Brent crude jumping 13% intraday. Nigerian crude grades like Bonny Light and Qua Iboe are now trading at $78 per barrel, slightly above the 2025 national budget benchmark of $75.
While this surge may improve Nigeria’s foreign exchange earnings and boost revenue projections — with analysts estimating a potential gain of $480 million if prices hold — it also means imported fuel prices will rise accordingly.
Motorists Brace for January-Level Prices
If trends persist, experts warn that fuel prices at the pump may return to levels last seen in January 2025, when petrol sold for up to N990 per litre in some locations.
The situation remains precarious, as tensions in the Middle East show no sign of easing, while domestic distribution challenges escalate.
A Fork in the Road for Nigeria’s Fuel Economy
The Dangote refinery’s direct intervention via its dedicated CNG fleet and proposed credit scheme for high-volume fuel users (500,000 litres and above) may provide a medium-term buffer, but with NARTO’s withdrawal and the ongoing standoff over Lagos’ E-Call Up system, disruption in supply appears imminent.
Analysts warn that failure to resolve these conflicts quickly could deepen Nigeria’s energy crisis, drive inflation further, and stall progress in economic reforms driven by the Tinubu administration.
The days ahead will test the resilience of the country’s fuel distribution network — and the resolve of its leaders.
