Nigeria’s petrol import economics opened 2026 with a sharp reversal, as estimated landing costs for Premium Motor Spirit (PMS) fell by about 8 percent, driven by weaker global crude prices, a firmer naira, and easing downstream pricing pressure.
According to data compiled by the Major Energies Marketers Association of Nigeria (MEMAN), the Estimated Import Parity Price into Tank shows that the 30-day average landing cost for PMS fell from ₦828.31 per litre on December 12, 2025, to ₦762.38 per litre by January 8, 2026—representing a ₦65.93 drop, or a 7.96% decline.
Spot indicators followed the same trend. ASPM spot prices fell from ₦765.18/litre to ₦703.72/litre, while NPSC–NOJ moved from ₦765.22/litre to ₦703.73/litre, reflecting an approximate 8.0% reduction across benchmarks.
Crude Retreat and FX Gains Drive Import Cost Drop
International oil markets set the tone. On December 12, 2025, crude prices slipped to multi-month lows as supply expectations overwhelmed geopolitical risks. Brent settled around $61.12 per barrel, while WTI closed at $57.44 per barrel, its weakest level since May.
The International Energy Agency (IEA) reinforced bearish sentiment with repeated forecasts of a record supply surplus in 2026 and rising global inventories to a four-year high. Thin holiday trading and risk-off sentiment in U.S. equities further pressured prices, despite fresh U.S. sanctions and continued Ukrainian drone attacks on Russian infrastructure.
By contrast, the market a year earlier had moved in the opposite direction. On January 8, 2025, Brent climbed to $81.00 per barrel, its highest in four months, as an Arctic blast threatened output and boosted heating demand while the U.S. tightened enforcement against Iran’s “shadow fleet.” That rally has since unwound. By January 8, 2026, Brent had fallen back to the $60.50 range, reflecting expectations of massive surpluses and the impact of a new U.S. deal opening access to Venezuelan crude.
Currency dynamics amplified the decline in naira-denominated landing costs. In mid-December 2025, the naira traded around ₦1,454.41/$ at the Nigerian Foreign Exchange Market (NFEM), improving modestly from ₦1,456.07/$ the day before. Between December 8 and December 12, the rate remained stable, ranging from ₦1,451.86/$ (strongest) to ₦1,456.07/$ (weakest).
The appreciation accelerated in early January 2026. From January 5 to January 8, the naira strengthened from ₦1,429.30/$ to ₦1,419.71/$, marking a 0.67% gain over four days. The firmer currency directly reduced the naira cost of imported fuel components.
Downstream Price Cuts and Regional Market Shifts Reinforce Decline
Domestic market actions also shaped the cost environment. On December 12, 2025, the downstream sector recorded broad price declines led by the Dangote Petroleum Refinery, which cut its ex-depot PMS price from ₦828/litre to ₦699/litre—its 20th price adjustment of the year. The reduction was widely expected to push retail prices below ₦739/litre ahead of the Christmas period.
At the same time, NNPC Limited confirmed that it had contained an incident on a section of the Escravos–Lagos Pipeline System (ELPS) reported on December 11, isolating affected segments and maintaining supply safety.
Regional product flows added further pressure. Traders increasingly diverted diesel and gasoil cargoes to West Africa, particularly the offshore Lomé market, as Mediterranean supply remained ample and demand weak. Market participants noted that West African gasoil prices traded at a premium to those in the Mediterranean, drawing Indian ultra-low-sulfur diesel into the region and reinforcing competitive pricing dynamics.
Outlook
The combined effect of lower crude benchmarks, a strengthening naira, aggressive domestic price cuts, and favourable regional supply flows has reset Nigeria’s petrol import economics at the start of 2026. With the import parity landing cost down nearly 8% from mid-December levels, the market now reflects a structurally softer price environment—unless global supply conditions or currency trends reverse.