Key Points

• Oil marketers raised petrol prices to N1,300 per litre nationwide, a 24 percent increase from N1,050, after Dangote Refinery hiked its gantry price to N1,175 per litre for the fourth time in two weeks.
• Transport fares doubled on several routes in Abuja and Ibadan as commuters absorbed the immediate impact of the fuel price surge across Nigeria.
• Industry group PETROAN warned that petrol could climb to N2,000 per litre and diesel to N3,000 if the Middle East conflict continues disrupting global crude oil supply.

Petrol is now selling at N1,300 per litre across much of Nigeria, a 24 percent jump from N1,050 just days ago, as the war grinding through the Middle East continues to drive global crude prices to levels not seen since the Russia-Ukraine conflict rocked energy markets in 2022.

The Dangote Petroleum Refinery fired off another price increase Monday, raising its gantry price for Premium Motor Spirit to N1,175 per litre from N995 per litre over the weekend, and bumping diesel to N1,620 from N1,430.

It was the fourth upward revision in less than two weeks, each one chasing crude oil higher as it climbed to $110 per barrel and briefly touched $120 in intraday trading.

Before the US-Israel-Iran hostilities broke out on Feb. 28, the refinery’s gantry price was sitting at N779 per litre. In barely 10 days, it has risen by N396.

How Quickly Prices Have Moved

The speed of the increases has caught commuters and businesses flat-footed. In Abuja, petrol was selling at N880 per litre on the Monday of last week.

By the weekend it had climbed to N960 and then N1,080. Monday morning it briefly hit N1,103 before jumping again by afternoon.

In Lagos, the Independent Petroleum Marketers Association of Nigeria confirmed marketers were purchasing the product from Pinnacle Oil and Gas, a tank farm operator, at N1,200 per litre, with pump prices settling between N1,250 and N1,300 in the city. Outside Lagos, the figure was already creeping toward N1,350 and beyond.

“The price at the pump is determined by logistics, transportation and mark-up,” IPMAN spokesperson Chinedu Ukadike said.

“Given that our members purchase the product at the rate of N1,200 per litre from Pinnacle Oil, the price will vary at the pump depending on location.”

Diesel told a similar story. MRS outlets were selling it at N1,380 per litre. NNPC Limited stations in Lagos and surrounding areas were charging N1,680.

Why the Dangote Refinery Cannot Absorb the Shock

Dangote Petroleum Refinery Managing Director David Bird pushed back Monday against suggestions the plant should be shielding Nigerians from global price swings.

Bird said the refinery does not receive crude at discounted rates and is fully exposed to international commodity prices, even under Nigeria’s crude-for-naira arrangement, because Nigerian crude is purchased from the government at international benchmark-related prices.

He noted that the refinery sources additional Nigerian crude from the international market, and that those cargoes often pass through multiple traders before reaching the facility, adding costs and premiums at each step.

Shipping costs have also spiraled. Bird said tanker costs had risen from roughly $800,000 to $3.5 million per shipment since hostilities began.

“Just a week ago, oil was trading in the mid-$60 range, and it has now climbed to nearly $120 per barrel,” he said. “What would be worse than $120 oil is no oil.”

Bird argued that Nigeria was still better positioned than fully import-dependent nations. He said the refinery, which runs at its nameplate capacity of 650,000 barrels per day with the ability to push output to 700,000 barrels through blending, could produce between 50 million and 55 million litres of petrol daily.

Nigeria’s daily consumption runs at roughly 35 million litres, he noted. Some countries, he said, had already begun rationing.

“We will ensure that Nigeria enjoys fuel abundance, not fuel scarcity,” Bird said, adding that pricing decisions rested with the government, not the refinery.

But the Refinery Isn’t Getting Enough Crude

The reassurance has limits. Olufemi Idowu, a partner at Kreston Pedabo, pointed out that the Dangote refinery is receiving only about five of the roughly 12 crude cargoes it needs each month from government-linked oil companies.

“The refinery has to source for the remaining seven from somewhere else,” Idowu said. “The rise in oil prices should ordinarily boost our economy, but in reality, citizens will likely not feel the benefit because of our reliance on imported refined products.”

An energy analyst who spoke separately said old stock provided no buffer. “It doesn’t matter that there is stock unless Nigeria will subsidise crude for Dangote again,” the analyst said. “Old stock doesn’t matter because the old stock will buy the new stock.”

Fares Double, Commuters Stranded

The pain at the pump translated quickly to bus stops and motor parks. In Abuja, fares on routes that cost N800 before prices started rising a week ago had shot to N1,500. The trip from Area 8 to Nyanya, previously N500, doubled to N1,000.

In Ibadan, intra-city fares climbed too. Trips from Sango to the University of Ibadan, which used to cost N200, were running at N250 to N300. The Dugbe to Ojoo route rose from N600 to N900.

Industry Sounds the Alarm

The Petroleum Products Retail Outlets Owners Association of Nigeria did not soften its warning. National President Billy Gillis-Harry said petrol could hit N2,000 per litre and diesel could approach N3,000 if the Middle East conflict showed no signs of ending.

Gillis-Harry called on NNPC Ltd. Group Chief Executive Bayo Ojulari to push for the immediate restart of the Area 5 plant at the Port Harcourt refinery and the Warri refinery.

Government-owned refineries, he argued, were less exposed to global supply disruptions than privately owned facilities dependent on imported crude.

“Continued fuel price increases will worsen inflation, cause job losses, deepen economic hardship, increase transportation costs and raise prices of goods and services nationwide,” Gillis-Harry warned.

A Government Budget Built for a Different World

Nigeria’s 2026 budget was built on a crude oil benchmark of $64.85 per barrel, with a projected daily output of 1.84 million barrels and an exchange rate of N1,400 to the dollar. With crude now trading at $110, the government has overshot its revenue benchmark by roughly 70 percent, even as its citizens absorb the full cost of a deregulated fuel market.

Professor Wumi Iledare, a petroleum economist, said the Dangote refinery had helped cushion some of the blow, estimating that domestic refining could absorb roughly 20 percent of the price shock by cutting out freight costs and supply delays that fully import-dependent countries could not escape.

“Without domestic refining, Nigerians would feel the full impact of global volatility,” Iledare said. “With it, some of that pressure can be cushioned.”

Maritime traffic through the Strait of Hormuz, the critical chokepoint through which roughly 20 percent of global crude oil and gas shipments pass, has been suspended since the conflict began on Feb. 28, compounding supply concerns worldwide.

Senior Market Analyst Matthew Anthony said oil-producing nations including Nigeria stood to earn significantly more revenue from the price surge, but cautioned that managing the resulting inflation would be the test.

“Major oil producing nations like Nigeria may profit from this conflict, provided they are able to put a lid on inflation and use the windfall for critical budget needs, while preparing for potential market shocks,” Anthony said.

Whether that windfall reaches ordinary Nigerians waiting at bus stops and paying N1,500 for a ride they used to take for N800 remains, at this point, an open question.