Nigeria’s inflation rate eased to 23.71% in April 2025, down from 24.23% in March, according to the latest data from the National Bureau of Statistics (NBS). This marks the first monthly decline in inflation this year, driven largely by falling fuel prices and declining global oil benchmarks.
Crude Oil Drop Eases Imported Fuel Costs
The sharp drop in Brent crude prices played a key role in the inflation decline. As of today, 15 May 2025, Brent crude traded at $64.64 per barrel, down from $83–$87 in March. The fall stemmed from OPEC+ supply management, weaker global demand forecasts, and easing geopolitical tensions.
As crude prices fell, Nigeria’s landing cost for petrol and diesel also dropped. The country, which relies heavily on imported refined products, saw pump prices soften. This directly reduced transport costs and energy expenses across sectors like logistics, manufacturing, and food distribution.
Fuel Prices Anchor the Inflation Slowdown
Fuel remains a critical driver of Nigeria’s inflation. Since the government removed petrol subsidies in 2023, domestic prices now respond directly to global oil movements. In April, lower pump prices helped slow the month-on-month inflation rate to 1.86%, a sharp drop from 3.90% in March.
Transport costs, closely tied to fuel prices, contributed 2.53% to the annual inflation rate, according to the NBS. The relief in fuel supply and pricing eased these pressures and helped slow the pace of price increases across the economy.
Core and Food Inflation Show Improvement
Core inflation, which excludes food and energy prices, also declined. It dropped to 23.39% year-on-year in April, down from 26.84% in April 2024. On a monthly basis, it slowed to 1.34% from 3.73% in March, reflecting reduced cost pressures across non-volatile categories.
Food inflation fell to 21.26% year-on-year, a significant drop from 40.53% in April 2024. The NBS attributed much of this to a base-year effect, though easing transport costs and improved supply chain access also helped stabilize food prices. Month-on-month food inflation edged down to 2.06%, compared to 2.18% in March.
Urban and Rural Inflation Trends
Inflation in urban areas declined to 24.29%, while rural inflation dropped to 22.83% on a year-on-year basis. Urban inflation also slowed significantly month-on-month, falling to 1.18% in April from 3.96% in March, further highlighting the broader impact of moderating energy and transport costs.
Outlook: Gains Remain Fragile
Despite April’s encouraging data, inflation risks remain. Nigeria’s dependence on imported fuel and foreign exchange volatility continues to expose it to global shocks. Any rebound in oil prices or disruption in domestic supply could reverse the current trend.
With the Central Bank of Nigeria’s next Monetary Policy Committee (MPC) meeting approaching, the April figures will likely influence its stance on interest rates and other policy tools to manage inflation.