Nigeria: Petrol Prices Jump By 47 Percent, Diesel 28.6 Percent in One Year

23 May 2023

Abuja — The price of petrol, arguably Nigeria's most consumed fuel, increased by a whopping 47.18 per cent on a year-on-year basis between April 2022 and April 2023, new data from the National Bureau of Statistics (NBS), has shown.

But when reviewed month-on-month, the figures from the NBS indicated that there was a slight reduction between March and April this year, to the tune of 3.87 per cent.

However, the jump in price of petrol is despite Nigeria's spending on its very controversial fuel subsidy regime, which has gulped up to N21.7 trillion in the last 18 and a half years, according to a recent THISDAY computation of data from the Nigeria Extractive Industries Transparency Initiative (NEITI) and industry figures between 2022 and H1 of 2023.

In all, between 2005 and 2021, N13.7 trillion was spent on subsidising petrol for Nigerians, while in 2022 and the first half of 2023 N8 trillion would have been expended

NEITI said that expenditure on petroleum products by the five income groups in Nigeria showed that the richest 20 per cent consumes 75 per cent of petrol in Nigeria while the poorest 20 per cent consumes just 1 per cent of the product.

Nigeria currently imports over 90 per cent of all its liquid products due to its dilapidated local refineries, which the Nigerian National Petroleum Company (NNPC) says are being rehabilitated.

Although the international price of crude oil remains the highest cost centre in the production of petrol, experts believe that shipping costs, ports charges, among others could be eliminated if the product is refined locally.

For context, the official price of petrol has more than doubled under the Muhammadu Buhari administration. While the pump price was N87 at the time the current president was taking over, the product now sells for between N185 and N235 in different parts of the country.

But the NBS data under consideration further indicated that Taraba state had the highest petrol price for the month of April this year, while Sokoto spent the least on a litre of fuel.

"The average retail price paid by consumers for Premium Motor Spirit (PMS) or petrol in April 2023 was N254.06, indicating an increase of 47.18 per cent relative to the value recorded in April 2022 of N172.61.

" Likewise, comparing the average price value with the previous month, that is, March 2023, the average retail price decreased by 3.87 per cent from N264.29.

"On state profile analysis, Taraba state had the highest average retail price for petrol with N320.00, followed by Imo with N310.55 and Jigawa with N305.00," the NBS report stated.

On the other hand, it explained that Sokoto recorded the lowest average retail price for premium motor spirit with N195.00, followed by Benue with N198.13 and Kogi with N206.11.

" In addition, analysis by zone showed that the South-east recorded the highest average retail price in April 2023 with N291.15, while the North-central had the lowest with N208.88," the data revealed.

In the same vein, the average retail price of Automotive Gas Oil (AGO) or diesel paid by consumers in April 2023 was N842.25 per litre, an increase of 28.69 per cent from N654.46 per litre recorded in the corresponding month of the previous year.

But the information stressed that on a month-on-month basis, this increased by 0.17 per cent from N840.81 per litre reported in March 2023.

"On state profile analysis, the highest average price of the product in April 2023 was recorded in Adamawa with N980.33, followed by Bauchi with N934.46, and Borno with N900.50.

" On the other hand, the lowest price was recorded in Bayelsa with N708.04, followed by Kebbi with N773.33 and Anambra with N773.56. Furthermore, analysis by zone showed that the North-east had the highest price with N895.42, while the South-south recorded the lowest price with N807.59," it added.

Nigeria's rising energy costs have resulted in the country's jumping inflation and contributes markedly to costs borne by manufacturers in Nigeria, with spending on electricity, gas and other fuels contributing significantly.

Recently, manufacturers said surging diesel prices will force them to cut jobs, curb operations and raise prices.

In addition, power, which is largely unstable normally accounts for as much as 40 per cent of factories' costs in Nigeria, according to the Manufacturers Association of Nigeria (MAN).

However, manufacturing accounts for about 13 per cent of output in Nigeria. Before the astronomical rise in diesel prices, Nigeria's was among the lowest in sub-Saharan Africa, according to data available. At over N800 naira now, it would be among the highest on the continent.

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