By: Tunji Okunlola
The Federal Government has announced 10 measures to cushion the impact of rising petrol prices and protect households, businesses and transport users from further price shocks.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, outlined the measures on Thursday at a press briefing on fuel prices and the subsidy question in Abuja. The government said they are meant to ease the immediate burden of higher pump prices without bringing back a blanket fuel subsidy.
1. 30-day petrol discount at NNPC stations
NNPC Limited will offer a margin discount on petrol for the next 30 days. “We are offering a discount on petrol dispensed by NNPC Limited for the next 30 days, with priority for public transporters nationwide,” Oyedele said. He said this is not a return to subsidy, explaining that the government would in effect allow petrol to be sold at cost under the arrangement.
2. More forward sales of crude to local refineries
As production rises, the government will increase forward sales of crude to domestic refineries. Oyedele said this would free up committed supplies and help shield local petrol prices from swings in the international market.
3. ₦1,350 ceiling on petrol landing cost
The government is negotiating a ceiling of ₦1,350 per litre on the ex-gantry or landing cost of petrol. Under the proposal, refiners and importers would absorb any shortfall when costs rise above the ceiling and recover it when crude prices or the exchange rate become more favourable.
“Where costs rise above the ceiling, refiners and importers will carry the shortfall and recover it later, when crude prices or the exchange rate allow, without breaching the ceiling,” Oyedele said. “This is neither a subsidy nor a price control: it is designed to smooth prices over time rather than suppressing them.” He argued that stable prices are better than volatile ones: “1,400 naira a litre today and 1,400 tomorrow is better than 1,500 today and 1,300 tomorrow, because volatility itself adds to uncertainty and cost.” He added that fares rarely fall as fast as they rise, and that the ceiling would be reviewed monthly, reset where costs require, and the figures published for transparency.
4. Removal of illegal levies
The Federal Government will work with states to curb illegal road taxes and levies that raise the cost of moving goods and services. Oyedele said this would be pursued under the 2025 tax reform laws.
5. More direct support for vulnerable Nigerians
The government will increase cash transfers to vulnerable households and provide subsidised credit to small businesses and consumers.
6. Faster rollout of CNG vehicles
Deployment of compressed natural gas vehicles will be accelerated, with support from federal and state governments. Transport operators will be encouraged to pass the savings from CNG on to passengers.
7. Possible excess profit tax
The government will consider an excess profit tax on operators found to be exploiting the situation anywhere along the energy value chain. “The proceeds will be used exclusively to cushion the impact of fuel prices, through transport support or vouchers for urban minimum wage earners who are the most vulnerable,” Oyedele said. The government also plans to work with the National Assembly on enhanced tax relief for low-income earners in the 2027 Finance Bill.
8. Lower regulatory costs
Unnecessary regulatory requirements and costs that add to business expenses, and ultimately to prices, will be reduced.
9. National Strategic Fuel Reserve
The government plans to set up a National Strategic Fuel Reserve to improve supply security and limit the impact of global disruptions. “Refined products will be released into the market under clear, published rules whenever a global disruption or hoarding threatens supply and price stability,” Oyedele said. “This is not a subsidy, and it does not fix prices; rather, it secures supply and reduces price volatility. It will prevent artificial scarcity, deter market manipulation, and anchor long-term energy security, so that a deregulated market delivers stable growth and not sudden price shocks.”
10. Better traffic and logistics management
The government will improve urban traffic management to cut fuel consumption and logistics costs, and will use NIPOST address codes to make logistics operations more efficient and cheaper.
No return to blanket subsidy
The measures follow a rise in petrol prices driven by higher international crude and refined-product prices. The government said it will rely on targeted support rather than a blanket subsidy. “To be perfectly clear, none of these measures restores a blanket subsidy. To do so would amount to creating longer-term harm for a short-term cure. Each measure is designed to reach the people who need help, without putting the wider economy at risk,” Oyedele said.
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