By Gloria Nosa
The intensifying confrontation involving the United States, Iran and Israel has sent global crude oil prices soaring, a development that is now driving petrol costs sharply upward in Nigeria and triggering widespread demands for urgent government intervention.
As the Middle East crisis enters its third week without signs of resolution, industry stakeholders, labour unions, economists and private sector leaders are urging the Federal Government to introduce economic relief measures to cushion the growing hardship faced by citizens and businesses.
Fuel prices across Nigeria have reportedly surged to between ₦1,200 and ₦1,300 per litre in several locations, while industry projections suggest the pump price could rise beyond ₦1,500 and even approach ₦2,000 per litre if tensions in the Middle East persist.
One of the major contributors to the increase is the recent adjustment in prices by the Dangote Petroleum Refinery. The refinery’s gantry price has climbed from under ₦800 per litre before the conflict began to about ₦1,175. At the same time, global crude prices have jumped from roughly $68 per barrel to over $100 per barrel.
Marketers urge government to cut levies
The Independent Petroleum Marketers Association of Nigeria has advised the government to review and reduce various taxes and regulatory charges imposed on petroleum products.
IPMAN spokesperson Chinedu Ukadike explained that fees collected by agencies such as the Nigerian Maritime Administration and Safety Agency, the Nigerian Ports Authority and the Nigerian Midstream and Downstream Petroleum Regulatory Authority contribute significantly to the high cost of fuel.
According to him, eliminating some of these charges could help bring down the retail price of petrol. He also stressed the importance of repairing pipelines across the country, noting that transporting fuel through pipelines is far cheaper than using trucks.
Ukadike further suggested reviving petroleum equalisation to stabilise pump prices nationwide, pointing out that residents in northern Nigeria currently pay more for fuel compared with those in the southwest where refining facilities are located.
Private sector advocates long-term solutions
Business leaders have also weighed in, urging the government to invest the additional oil revenue from rising crude prices into strategic sectors rather than returning to fuel subsidies.
The President of the Lagos Chamber of Commerce and Industry, Leye Kupoluyi, said Nigeria should channel part of the oil windfall into boosting local refining capacity and expanding alternative energy sources such as compressed natural gas.
He suggested that allowing domestic refineries to purchase crude oil in naira could strengthen the local petroleum value chain and help stabilise product supply.
Kupoluyi also called for incentives to encourage the conversion of vehicles from petrol to compressed natural gas, arguing that reducing petrol consumption in the transport sector would ease pressure on fuel demand.
Rising fuel costs threaten businesses
Economists warn that the surge in energy prices is worsening the already difficult operating environment for Nigerian businesses.
Dr Muda Yusuf of the Centre for the Promotion of Private Enterprise said many companies depend heavily on petrol and diesel generators because of unreliable electricity supply. As fuel costs increase, production expenses and logistics costs also rise.
According to him, the situation could further weaken business profitability, particularly for small and medium-sized enterprises already grappling with high inflation and elevated borrowing costs.
Labour calls for urgent intervention
The Nigeria Labour Congress has also raised alarm over the impact of rising fuel prices on workers.
In a statement signed by its President, Joe Ajaero, the union warned that Nigerian workers are already struggling to cope with the high cost of living and urged the government to introduce immediate support measures.
Among the proposals put forward by the NLC are wage awards, cost-of-living allowances, tax relief for low-income earners and expanded social support programmes.
The labour body also renewed its call for the rehabilitation of Nigeria’s government-owned refineries in Port Harcourt, Warri and Kaduna, arguing that stronger domestic refining capacity would help reduce the country’s vulnerability to global oil price shocks.
Experts caution against subsidy return
Despite the pressure on the government to intervene, the Nigerian Economic Summit Group has warned policymakers against reintroducing petrol subsidies.
According to the policy advisory group, while rising oil prices could generate additional revenue for Nigeria, restoring subsidies could undermine fiscal discipline and reverse recent economic reforms.
The organisation explained that Nigeria historically suffered from an “oil exporter but fuel importer paradox,” where higher crude oil prices increased government revenue while simultaneously raising the cost of imported refined products.
Although domestic refining has improved with the emergence of the Dangote refinery, analysts believe the surge in global oil prices could still add between 1.3 and 5.2 percentage points to Nigeria’s inflation rate in the coming months.
Experts therefore recommend that the government save part of the oil windfall, strengthen foreign reserves and provide targeted assistance to vulnerable households rather than returning to blanket fuel subsidies.
However, with the Middle East conflict showing no signs of easing, many Nigerians fear that petrol prices could climb even higher in the coming weeks, placing further pressure on households and businesses across the country.
