The landing cost of petrol in Nigeria has surged to N870 per liter, surpassing the price set by leading oil magnate Aliko Dangote’s refineries, which had previously been the benchmark for fuel pricing in the country. This significant rise in the cost of petrol has raised concerns about the sustainability of fuel prices and its potential impact on the Nigerian economy.
The increase in landing cost is attributed to several factors, including rising global crude oil prices, fluctuations in the exchange rate, and increased transportation costs. The landing cost represents the price at which imported refined petrol is brought into the country, and it is a key determinant of the final retail price at filling stations.
For months, the Nigerian National Petroleum Corporation (NNPC) had maintained a relatively lower price compared to the market, relying on subsidies to manage the cost. However, as global oil prices continue to climb, the financial pressure has forced a reevaluation of this approach. The rise in landing cost now puts even more pressure on the government to either absorb the costs or pass the increase to consumers.
Dangote’s refineries, which are expected to begin full operations soon, have been seen as a potential solution to Nigeria’s reliance on imported refined petrol. However, with the landing cost now exceeding Dangote’s price projections, there are concerns about how the refineries will compete in the local market and whether they will be able to stabilize prices once they are fully operational.
Economists are warning that this sharp increase in petrol prices could lead to inflationary pressures, particularly in sectors that heavily depend on fuel for transportation, including agriculture, manufacturing, and logistics. Consumers are already feeling the strain of higher transportation costs, and the ripple effects are expected to affect food prices and other essential goods.
The government has yet to make a formal statement on whether any adjustments will be made to fuel subsidies or if new measures will be introduced to mitigate the effects of the rising petrol costs on the average Nigerian. However, with elections looming and public sentiment growing increasingly discontented with rising living costs, the issue of fuel price hikes is expected to be a focal point in upcoming political debates.
As Nigerians brace for the impact of the rising petrol landing cost, the situation highlights the country’s ongoing struggles with energy dependence, the complexities of managing fuel prices, and the need for long-term solutions to address the challenges of energy production and distribution.
