World Bank Report Highlights Price Gap Between Imported and Local Petrol
The World Bank has disclosed that imported Premium Motor Spirit (PMS), commonly known as petrol, is currently more affordable than fuel supplied by the Dangote Petroleum Refinery in Nigeria. According to the institution's latest Nigeria Development Update, released in Abuja on Tuesday, April 7, 2026, imported petrol is approximately 12% cheaper than locally refined petrol from Dangote.
Dangote's Ex-Depot Price Exceeds Import Parity
The report indicates that as of March 23, 2026, the Dangote Petroleum Refinery set its ex-depot price at about N1,275 per litre. In contrast, the estimated import-parity price stands at around N1,122 per litre, creating a significant price gap that favors imports. This disparity reflects distortions in Nigeria's domestic pricing framework, exacerbated by rising global crude oil prices and shifting market dynamics.
Refinery Dominance and Regulatory Changes
The World Bank noted that the Dangote Refinery has become the dominant supplier of petrol in Nigeria following the regulator's decision to halt the issuance of import licences earlier in 2026. This move has concentrated supply, but the price differential raises concerns about market efficiency and consumer costs.
Inflation Risks from Global Oil Price Hikes
The Washington-based institution warned that sustained increases in global oil prices, driven partly by geopolitical tensions in the Middle East, could worsen inflationary pressures in Africa's largest economy. It projected that a rise in crude oil prices to around $80 per barrel could increase Nigeria's headline inflation by about 3.1 percentage points, assuming full pass-through to domestic fuel prices.
Impact on Transport and Broader Economy
Energy-related costs, particularly transport, which accounts for approximately 10.1% of Nigeria's consumer price index, remain a major channel through which fuel price shocks spread across the economy. The World Bank cautioned that higher global food and fertiliser prices could further drive inflation, compounding cost-of-living pressures for households.
World Bank Officials Comment on Nigeria's Economic Conditions
Speaking at the report presentation, Mathew Verghis, the World Bank's Country Director for Nigeria, stated that recent reforms have supported some improvement in macroeconomic conditions through 2025 into early 2026. However, he warned that external shocks, including rising energy and shipping costs, continue to pose risks to price stability.
Fiseha Haile, the bank's Lead Economist for Nigeria, added that petrol price increases are already transmitting across transport and logistics chains, further affecting goods and services. He noted that while Nigeria's external position has improved, supported by higher reserves and exchange rate reforms, uncertainties in global financial markets and weaker capital inflows remain key risks.
Conclusion and Call for Structural Reforms
The report concluded that although Nigeria's economy is showing resilience, inflation continues to erode purchasing power. It underscored the need for structural reforms to stabilise prices and support vulnerable households, highlighting the ongoing challenges in balancing local production with import costs.
Recent Fuel Price Trends in Nigeria
In related developments, fuel prices across Nigeria's major depots rose again on April 2, 2026, as a sharp surge in global crude oil prices pushed up the cost of refined products. Data compiled by PetroleumPriceNG shows that the average price of petrol increased modestly from about N1,234 per litre on April 1 to N1,242 per litre on April 2, indicating renewed pressure on the downstream oil market.
