….says it will push pump prices above ₦1,000/L₦says1,000/L.
….says it will push pump prices above ₦1,000/L₦says1,000/L.
….will hurt low-income Nigerians, small businesses
The Major Energy Marketers Association of Nigeria (MEMAN) has cautioned that the 15 per cent import tariff on fuel products could raise pump prices and burden consumers unless properly managed.
Specifically, it stated that when the tariff is eventually implemented , it will increase the pump prices of petrol and diesel (AGO) to N998 a litre of petrol around Lagos and its environ and ₦1,028 a litre in upcountry markets, while that of diesel could be between N1,164 and N1,194 depending on marketing margins, thereby significantly raising fuel prices across the country.
Speaking at a Webinar it organized along with S&P Global Commodity Insights on Thursday, the association’s Executive Secretary, Clement Isong, advised that the government should think it through before slamming the
tariff on these two products as it is capable of having unimaginable economic consequencies on the common man
On the topic, “Market Context and Local Refineries Protection,” he cautioned that the policy could be regressive and disproportionately impact low-income households and small businesses unless mitigated.
The association urged the federal government to consider complementary policies that promote competition, transparency, and consumer protection in the deregulated market.
Clement Isong noted that while the National Petroleum Policy encourages local refining and market liberalization, imposing a high import tariff on refined petroleum products could unintentionally push pump prices up.
He called for a transparent, evidence-based policy debate, urging that open market pricing computations and end-user prices be published regularly to prevent information asymmetry and market abuse.
According to him, the new tariff would raise the landing cost of imported products, allowing local refiners to recover costs and margins—a key argument advanced by proponents who maintain that domestic production costs currently exceed import costs.
He added that importers would likely pass the tariffs on to consumers, while domestic refiners would price just below the new landed-cost floor, effectively removing the import benchmark that currently keeps prices competitive.
He warned that such changes could create competitive distortions, squeezing smaller independent importers out of the market, and stressed the need for active regulatory oversight by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to ensure fair competition and nationwide product availability.
“Public policy must be data-driven, evidence-based, and independently verified,” Isong said. “Regulatory safeguards must be in place to prevent excessive price hikes and to protect consumers from undue hardship.”
He explained that the tariff, if implemented, should have a sunset clause and be tied to measurable growth in domestic refining capacity. The regulator, he stressed, must constantly review refining economics and remove the tariff once local supply improves.
MEMAN recommended alternative and complementary solutions to tariffs, including phased or conditional tariff implementation linked to verified domestic refining milestones; production-linked incentives and temporary tax credits for local refiners based on uptime, investment, and job creation; financial support such as low-interest loans or tax relief to help existing and modular refineries become competitive; stronger anti-smuggling enforcement and customs reforms to prevent market distortions; and exchange rate management to make local products more competitive.
The association also urged fast-tracking of NNPC Heritage and modular refineries to increase local fuel availability and reduce import dependence, describing direct support to domestic producers as a “superior economic policy to tariffs.”
At the same event, S&P Global Commodity Insights analysts Dumdisi Awanen and Tanya Stepanova presented a paper titled “Navigating Transformation: Lessons from Global Markets for Nigeria’s Energy Future.”
Their analysis showed that Nigeria remains a pioneer in fuel market liberalization in Africa but still requires strong regulatory oversight to ensure fair competition and prevent monopolies.
Using case studies from Ghana, Zambia, Morocco, and South Africa, the report highlighted how excessive protectionist policies can distort markets, while transparent regulation and open-access systems promote competition and price stability.
In Ghana, for instance, the National Petroleum Authority (NPA) sets indicative maximum and minimum pump prices to protect consumers while allowing fair margins for marketers. Zambia’s open-access TAZAMA pipeline system, introduced in 2025, has also helped lower diesel prices by encouraging competition among transporters.
The S&P Global team emphasized that striking the right balance between supporting Nigeria’s emerging refining sector—led by the Dangote Refinery and others—and maintaining market competition will be crucial for sustainable energy development.
They noted that while Dangote’s ex-refinery prices are currently lower than import parity prices when logistics are considered, continued transparency and fair regulation are needed to prevent market dominance and ensure that liberalization benefits all stakeholders.
Both MEMAN and S&P Global agreed that Nigeria’s downstream sector is undergoing a major transformation, with new refineries, deregulated pricing, and declining imports marking a new era. However, they cautioned that policy missteps, such as premature tariffs or weak regulation, could undermine progress.
“Nigeria’s success will depend on how well it balances refinery support, consumer welfare, and market competition,” the report concluded.
