Nigeria’s petrol market is once again under intense pressure as rising global crude oil prices push domestic fuel costs sharply higher, exposing the fragile balance between local refining and international market realities. Fresh data indicates that Nigerians are now paying about 65 percent more for petrol, as the Dangote Refinery grapples with escalating crude import costs amid the ongoing Middle East crisis.
At the international market, crude prices have resumed an upward trajectory. Brent crude traded around $112 per barrel, while West Texas Intermediate (WTI) climbed above $103, reflecting renewed supply concerns tied to geopolitical tensions. Murban crude also recorded gains, underscoring a broader rally across key benchmarks, even as natural gas prices slipped.
The surge in crude prices has directly impacted the cost structure of the Dangote Refinery, which, despite being Africa’s largest, continues to rely significantly on imported crude. According to the refinery’s management, the situation has been worsened by the inability of domestic upstream producers to meet supply obligations under the Petroleum Industry Act (PIA), forcing the refinery to source crude from international traders at a premium.
“The high cost of crude is further compounded by limited local supply, leaving us with no option but to import at additional cost,” the company stated earlier, highlighting the growing strain on operations.
This reality has inevitably filtered down to the pump, where consumers are now bearing the brunt of higher production and logistics expenses.
Further insight from the refinery’s leadership reveals a widening supply gap. The Chief Executive Officer, David Bird, disclosed that the facility currently receives only five local cargoes out of the 13 to 15 initially agreed, a shortfall that continues to disrupt pricing stability. “We try to maintain stability within a commercially acceptable range, but all our cost inputs from crude to freight and insurance have risen significantly,” he said.
Ironically, this comes at a time when the Dangote Refinery had begun to assert dominance in Nigeria’s fuel supply chain. Before the latest crisis, the facility accounted for about 62 percent of the country’s petrol supply, overtaking traditional importers for the first time. It also achieved record processing volumes in January 2026, signalling strong operational momentum.
However, the current global supply shock has laid bare the refinery’s dependence on foreign crude, raising broader concerns about Nigeria’s energy security. While the refinery was expected to stabilise domestic prices, its exposure to international market forces means local pump prices remain highly sensitive to global fluctuations.
For consumers, the implication is clear: as long as crude prices remain high and local supply gaps persist, petrol prices are likely to stay high. The situation underscores the urgent need for improved domestic crude allocation and a more resilient supply framework to shield the Nigerian market from external shocks.