Nigeria petrol prices soar to record high

Petrol prices in Nigeria reached 617 naira ($0.7802) per litre on Tuesday, the highest ever, as fuel prices rose in the second month after President Tinubu scrapped a popular but costly fuel subsidy in May.

Prices were updated nationwide from 557 naira per litre across fuel stations operated by the state-owned Nigerian National Petroleum Co. Ltd. (NNPC), according to a circular seen by Reuters. NNPC did not immediately respond to calls seeking comments.

Clement Isong, head of the Major Oil Marketers Association of Nigeria (MOMAN), said the increase was due to rising global oil prices and the naira’s exchange rate to the dollar, adding that “there has to be cost recovery” for retailers.

MOMAN, which groups Nigeria’s six largest fuel retailers including the NNPC, accounts for about a third of the petrol market.

Tinubu, who’s embarking on Nigeria’s biggest reforms in decades to tackle issues including its high debt burden, ended the subsidy, which had kept prices cheap for decades but had become increasingly expensive, costing the government $10 billion last year.

Since ending the subsidy, 56 private firms have been licensed to import petrol, with 10 of them due to make supplies in the third quarter, ending NNPC’s import monopoly. NNPC had been the sole importer of petrol using crude swap contracts.

“Out of these 10, three of them have already landed cargoes … and others are also indicating interest to import in August and September,” Farouk Ahmed, head of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), said in a statement.

Nigeria, Africa’s largest oil producer, imports almost all its refined fuel due to inadequate refining capacity and neglect of existing refineries.

($1 = 790.8000 naira)