In June of 2023, Nigeria witnessed a significant upsurge in the retail cost of gasoline, commonly known as petrol. A recent report issued by the National Bureau of Statistics (NBS) revealed that the price of this essential commodity surged by an astonishing 152%. This surge occurred after the removal of government subsidies on petrol in May 2023.
According to data compiled by the NBS, the average price per liter of petrol soared from N238.11 prior to the subsidy removal to a staggering N600.35 by July. Notably, this surge was most pronounced in the month of June, with a monthly increase of 9.99%, escalating from N545.83.
This subsidy removal was officially announced by President Bola Tinubu during his inaugural address on May 29 of the same year. The move aimed to foster a competitive market environment driven by the forces of demand and supply. To mitigate the impact of this removal on the populace, the President also introduced measures to provide relief to Nigerians affected by the change.
Reports from BusinessDay indicated that petrol marketers attributed the elevated price to challenges associated with importation and the difficulty in accessing foreign exchange (Forex) for procuring the product.
In a bid to address the economic situation, the Nigerian National Petroleum Company Limited (NNPC) injected a substantial $3 billion loan secured from AfreximBank into the economy.
When analyzing petrol prices on a state-by-state basis, Borno State emerged with the highest average retail price, reaching N657.27. Following closely were Abia and Gombe States, with average prices of N643.13 and N642.22, respectively. In contrast, Edo, Kwara, and Benue States registered the lowest average retail prices at N530.00, N535, and N537, respectively.
Taking a broader perspective, on a zonal level, the North East zone posted the highest retail price at N630.13, while the North Central Zone exhibited the lowest price at N551.58, as outlined in the report.
In the wake of President Bola Tinubu’s announcement that there will be no more increases in petrol prices across Nigeria, petrol marketers are seeking subsidies to mitigate the impact of escalating import costs.
This development arises due to the marketers’ assertion that depot prices have surpassed the prevailing pump price of the product. A report from Punch suggests that the Nigerian government might be discreetly disbursing subsidies to marketers in order to prevent further price escalations. Presently, the commodity is trading between N568 and N617 in certain regions of Nigeria due to fluctuations in foreign exchange rates, as the product is entirely reliant on imports.