The Federal Government has announced a 30-day discount on petrol sold at retail outlets operated by the Nigerian National Petroleum Company Limited, NNPCL, as part of measures to ease the pressure of high fuel prices and stabilise pump prices across the country.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Thursday during a press briefing on fuel pricing and subsidy issues in Abuja.
According to Oyedele, the discount is not a return to subsidy regime but an arrangement to sell the product to Nigerians at cost price, with priority given to commercial transporters nationwide.
“We are offering a discount on petrol dispensed by NNPC limited for the next 30 days in the first instance with priority for public transporters nationwide. So, it’s not a subsidy, government is just saying we sell to you at cost,” the minister said.
He explained that the Federal Government decided to introduce the fresh intervention because existing measures have not fully addressed the hardship faced by households and businesses following the rise in fuel and transportation costs.
Oyedele also revealed that the government is working on a price modulation framework that will set a ceiling of N1,350 per litre on the ex-gantry or landing cost of petrol, a move aimed at preventing volatility in global crude prices and foreign exchange rates from immediately affecting local pump prices.
He clarified that the N1,350 ceiling does not translate to the pump price, but represents the maximum cost at which petrol will land or leave the gantry, to ensure stability at filling stations.
“The proposed ceiling does not mean petrol will sell for N1,350 per litre at filling stations. Rather, it is intended to prevent sharp movements in global crude prices or the exchange rate from immediately translating into corresponding increases in the cost of petrol,” he said.
“Pump prices should not have to follow every swing in global crude or the exchange rate. The government is negotiating a ceiling of N1,350 a litre on the ex-gantry or landing cost of petrol to keep pump prices stable,” Oyedele added.
Under the arrangement, when the actual landing cost rises above the agreed ceiling, refiners and importers will initially absorb the shortfall and recover it later when market conditions improve and prices fall below the ceiling.
The minister stressed that the mechanism is neither a subsidy nor price control, but a stabilisation tool designed to smooth out price fluctuations over time and reduce uncertainty in the downstream sector.
“The reasoning is simple, N1,400 a litre today and N1,400 a litre tomorrow is better than N1,500 a litre today and N1,300 a litre tomorrow. Why? Because volatility itself adds to uncertainty and cost and when fuel goes up sharply, they rarely come down as fast,” he said.
Oyedele further disclosed that the ceiling will be subject to monthly reviews, with details to be published transparently for public accountability.
He assured Nigerians that the Federal Government remains committed to ensuring affordable and stable fuel supply while maintaining a deregulated market that encourages investment and efficiency in the oil and gas sector.
