Nigerians Await Fuel Price Cuts Amid Crude Oil Decline

Nigerians are anticipating a reduction in petrol prices from Dangote Refinery, the Nigerian National Petroleum Corporation (NNPC), and fuel marketers, as crude oil prices have fallen to $73 per barrel. Currently, petrol prices range from ₦1,200 to ₦1,360 per liter, raising questions about the disconnect between crude oil prices and retail fuel prices.

Analysts attribute the delay in price cuts to structural lag and inventory costs, as refineries have already purchased crude at higher prices. Kelvin Emmanuel, a managing partner at an energy consulting firm, explained that the transfer price rule mandated by the Petroleum Industry Act (PIA) has not been operationalized, complicating price adjustments.

Wumi Iledar, a professor of petroleum energy economics, noted that price increases are reflected quickly, while decreases tend to lag. Ademola Adigun, CEO of AHA Consult, stated that downward adjustments in refined products will take time, indicating that immediate price reductions are unlikely.