Marketers Urge FG to Consider Temporary Subsidy Amid Middle East Crisis
The Association of Nigeria Refineries Petroleum Marketers (ANRPM) has called on the Federal Government to implement a temporary subsidy on petroleum products. This move aims to alleviate the financial burden on Nigerians caused by escalating oil prices, which have been driven by ongoing conflicts in the Middle East.
Global Oil Market Volatility and Local Impacts
Recent attacks on fuel tankers and geopolitical tensions have pushed Brent oil futures to approximately $117 per barrel, marking a significant monthly gain. The Strait of Hormuz, a critical global supply corridor, has faced disruptions, exacerbating volatility in energy markets worldwide.
In response to crude shortages, the Nigerian National Petroleum Company Limited (NNPCL) is increasing its allocation to Dangote Refinery. For May loading, seven crude cargoes will be provided, up from five in previous months, according to trade sources cited by Reuters.
ANRPM President's Appeal and Policy Recommendations
National President of ANRPM, Henschel Nwozuzu, emphasized that Nigeria, despite being a major crude oil producer, remains vulnerable to external shocks due to its pricing structure tied to international dynamics. He warned that allowing distant conflicts to dictate local fuel prices places undue pressure on citizens already facing economic hardship.
Nwozuzu advocated for a combination of targeted subsidy, support for local refining, and regulatory oversight. He highlighted the need for increased crude supply to facilities like the Dangote Refinery to stabilize domestic supply and reduce import dependence. Additionally, he called for strict standardization in modular refinery operations to prevent substandard products from entering the market.
Dangote Refinery's Role and Challenges
Dangote Refinery, Africa's largest with a capacity of 650,000 barrels per day, has been sourcing only about five crude cargoes monthly locally, far short of its required 13 to 15. This shortfall forces imports at prices influenced by Middle East conflicts. Recently, the refinery increased gasoline supplies to meet over two-thirds of Nigeria's daily requirement of 60 million liters but had to raise depot prices by about 13%.
New Gas Pricing and Global Profit Surges
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has set a new Domestic Base Price for natural gas at $2.18 per MMBtu, effective April 1, 2026. This aims to boost supply to domestic sectors like power and industry, with commercial users paying $2.68 per MMBtu. The pricing aligns with the Petroleum Industry Act 2021 and international benchmarks.
Meanwhile, global oil companies have reportedly raked in over $100 billion in windfall profits due to supply disruptions and geopolitical tensions. A report by climate group 350.org estimates that $104 billion to $111 billion has been transferred from consumers to oil firms within a month, highlighting the uneven impact of fossil fuel dependence.
International Context and Escalating Conflicts
In the Middle East, recent incidents include an attack on an oil refinery in Haifa, Israel, and an oil tanker set ablaze off Dubai, with Iran or Hezbollah militants suspected. U.S. President Donald Trump has suggested taking oil from Iran amid the conflict, as the U.S. national average retail price of petrol crossed $4 per gallon for the first time in over three years.
As the crisis deepens, stakeholders urge proactive measures to protect Nigerian citizens from global oil shocks while fostering local energy resilience.
