By George Ozalla
The Nigerian National Petroleum Company Limited (NNPCL) has raised its petrol pump price to ₦1,405 per litre, reversing an earlier reduction and raising fresh questions about the Federal Government’s temporary fuel discount.
The latest adjustment followed a reduction from ₦1,405 to ₦1,370 per litre earlier in the week. The back-and-forth changes have left motorists uncertain about the actual price of petrol at NNPCL filling stations and how the government’s announced relief measure is being implemented.
The Federal Government had announced a temporary discount of ₦66 per litre to mark Nigeria’s 66th Independence Anniversary. The arrangement was intended to ease the pressure of rising fuel costs on households, transport operators and businesses.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, explained that NNPCL Retail would temporarily forgo its retail profit margin to provide the relief. The government maintained that the arrangement was a commercial decision by the company and not a return to the fuel subsidy regime abolished in May 2023.
NNPCL subsequently announced that the discount would run until October 31 at its retail outlets nationwide.
However, the arrangement has attracted criticism over the conditions for accessing the reduced price. Motorists have reportedly been required to download the NNPCL Fuel App and pay digitally to benefit from the discount, raising concerns about consumers who do not have smartphones, reliable internet access or the ability to use digital payment platforms.
The difference between the advertised discount and the price paid by motorists at the pump has also generated confusion. While customers using the application were reportedly able to purchase petrol at a reduced rate, motorists paying through the regular process faced a higher price.
The Nigeria Labour Congress questioned the adequacy of the reduction, while former Vice President Atiku Abubakar criticised the arrangement and raised concerns about its implementation.
Other concerns have centred on the restriction of the discount to NNPCL outlets, leaving motorists who patronise independent filling stations outside the arrangement. In areas where NNPCL stations are scarce, consumers may have to travel farther to benefit from the reduced price, adding to their transport costs.
The financial implications have also attracted attention. Based on an estimated monthly sales volume of 70 million litres, a reduction of ₦66 per litre could translate to about ₦4.62 billion in lower gross sales revenue if the entire volume qualified for the discount. The actual effect on the company’s profit would depend on its operating costs and the extent to which the concession is absorbed by its retail margin.
Oyedele also announced that the Federal Government was negotiating a ceiling of ₦1,350 per litre on the ex-gantry or landing cost of petrol. Under the proposed arrangement, refiners and importers would absorb costs above the ceiling and recover the shortfall when market conditions improve.
The proposed ceiling is different from the retail discount and does not automatically mean petrol must sell at ₦1,350 per litre at every filling station. Transportation, distribution and other operating costs can affect the final pump price.
The government has attributed the pressure on petrol prices partly to movements in the international oil market, including developments in the Middle East. Changes in crude oil prices, exchange rates and the cost of supplying refined petroleum products can influence domestic prices under the market-based system.
The latest increase to ₦1,405 per litre, coming shortly after a reduction, has put the spotlight on NNPCL’s pricing decisions and the practical benefits of the temporary discount. Motorists will be looking for clearer communication on pump prices and the conditions required to access the relief before the arrangement expires on October 31.
