Petrol prices in Nigeria are edging close to US$1 per litre in several parts of the country as a surge in global crude oil prices, driven by escalating tensions in the Middle East, feeds into domestic fuel costs.
The increase comes as international benchmark Brent crude rose sharply from about US$105 per barrel to US$118 per barrel within days, amid heightened tensions involving the United States and Iran over access to the strategic Strait of Hormuz.
The disruption has triggered renewed volatility across global energy markets, pushing up crude costs and feeding directly into refined fuel prices across importing economies and partially self-sufficient producers alike.
At the centre of Nigeria’s domestic pricing system is the country’s largest private refinery, Dangote Petroleum Refinery, which reportedly raised its ex-depot petrol price from about US$0.86 per litre (₦1,200) to around US$0.91 per litre (₦1,275) in response to higher crude input costs.
Retail prices quickly followed. Fuel stations in Lagos and surrounding states were selling petrol at between US$0.94 and US$0.96 per litre (₦1,315–₦1,350) on Wednesday, while prices in northern regions and more remote areas climbed closer to US$1.00 per litre (₦1,400).
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In some border communities, transport bottlenecks pushed prices even higher, with reports of petrol reaching about US$1.21 per litre (₦1,700).
The latest increases come as global oil markets react to supply fears linked to the Middle East conflict, with traders pricing in the risk of prolonged disruption to shipping routes that carry a significant share of global crude exports.
Nigeria, despite being one of Africa’s largest oil producers, remains heavily exposed to global price swings because domestic fuel prices are largely benchmarked to international crude markets.
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The situation has been further complicated by adjustments in crude pricing by the state oil company, Nigerian National Petroleum Company Limited, which reportedly increased the official selling prices of its crude grades for May-loading cargoes, reflecting stronger global demand and tighter supply conditions.
Industry analysts say the upward adjustment in crude prices is feeding directly into higher costs for refiners, including Dangote’s facility, which has only recently begun large-scale operations and is still stabilising supply chains.
Retail marketers have also pointed to volatile pricing conditions that make it difficult to maintain stable pump prices, with some operators adjusting rates multiple times within days.
The Petrol Retail Outlet Owners Association of Nigeria warned that prices could climb further if geopolitical tensions persist and supply routes remain constrained. Some estimates suggest petrol could exceed $1.07 per litre (₦1,500) if the crisis escalates.
Beyond global pressures, domestic stakeholders argue that Nigeria’s pricing structure—still tied to international benchmarks—amplifies the impact of external shocks on local consumers.
Energy economists have called for reforms to the pricing system, including potential domestic crude pricing arrangements that could insulate local refineries from global volatility.
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However, officials have yet to announce any immediate policy response, even as inflationary pressures rise and transportation costs increase across the country.
Some industry voices argue that Nigeria could benefit from higher crude prices through increased export revenues, but warn that these gains may be offset by the domestic economic burden of expensive fuel.
The broader crisis in the Middle East has also intensified geopolitical uncertainty, with shipping disruptions in the Strait of Hormuz threatening global oil flows and adding a risk premium to energy markets.
As traders continue to assess the duration and severity of the standoff, analysts say fuel prices in import-dependent or partially import-dependent economies like Nigeria are likely to remain highly volatile in the near term.
For now, motorists and businesses across the country are bracing for further increases, as global oil dynamics continue to ripple through domestic markets with immediate and visible effects.
