Local Refining Cannot Prevent Fuel Price Volatility in Nigeria

The Centre for the Promotion of Private Enterprise (CPPE), led by Chief Executive Officer Dr. Muda Yusuf, issued a policy brief stating that local refining in Nigeria will not automatically prevent fluctuations in petrol fuel prices.

The brief highlights that crude oil price dynamics in the global market continue to dictate the cost of refined products, regardless of local refining efforts. Recent adjustments in petroleum product prices in Nigeria reflect developments in the global energy market, particularly the sharp rise in crude oil prices, which recently surged to $100 per barrel, marking a 50% increase within a week.

The CPPE emphasizes that while local refining may offer some cost advantages, such as reduced logistics costs, the overall cost structure remains closely linked to global crude oil price movements. The organization stresses the importance of developing domestic refining capacity to enhance Nigeria's energy security and reduce vulnerability to international supply shocks.