The Federal Government has taken a significant step to stabilize fuel prices by suspending the controversial 15% import duty on Premium Motor Spirit (PMS) and diesel.
Government Reverses Import Tax Policy
Through the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the government announced the suspension of the 15% ad-valorem import duty that was previously approved for imported petrol and diesel. The announcement came in an official statement signed by George Ene-Ita, Director of the Public Affairs Department, on November 13, 2025.
This decision represents a major policy reversal after President Bola Ahmed Tinubu had initially approved the 15% import duty in October 2025. The original policy had generated substantial concern within the oil and gas sector, with industry operators warning that it could lead to higher petrol prices, worsen inflation rates, and increase overall import costs.
Mixed Reactions and Economic Concerns
The suspended import duty was introduced as part of the Federal Government's new tariff framework for petroleum products. The policy was designed to support emerging local refineries, including the Dangote Petroleum Refinery and various modular plants, by making imported products less competitive.
However, stakeholders had expressed serious concerns about the timing of the tax implementation. Many argued that introducing such a tax while Nigeria's domestic refineries had not yet achieved full operational capacity could have negative economic consequences. The primary worries included potential exacerbation of inflation and further increases in pump prices at a time when Nigerians are already facing economic challenges.
Assurance of Adequate Supply
In the statement released by NMDPRA, the authority provided reassurance about the country's petroleum supply situation. The regulatory body confirmed that adequate supply of petroleum products exists within acceptable national sufficiency thresholds, particularly during this peak demand period.
The authority highlighted that there is robust domestic supply of petroleum products, including Automotive Gas Oil (AGO), Premium Motor Spirit (PMS), and Liquefied Petroleum Gas (LPG). These supplies are sourced from both local refineries and imports to ensure timely replenishment of stocks at storage depots and retail stations.
The NMDPRA specifically advised against hoarding, panic buying, or non-market reflective escalation of prices of petroleum products. The authority emphasized its commitment to closely monitoring the supply situation and taking appropriate regulatory measures to prevent any disruption in the supply and distribution of petroleum products across Nigeria.
The statement clearly noted that implementation of the 15% ad-valorem import duty on imported Premium Motor Spirit and Diesel is no longer in view, providing certainty to market participants and consumers alike.
