Tinubu’s Nigeria fuel subsidy gamble falters as petrol hits ₦1,596 (US$1.20) a litre
Economy · Nigeria
Key Facts
- —The stakes Fuel subsidy removal tripled household transport costs and reordered Nigeria’s petrol supply chain.
- —The price Average petrol hit ₦1,596.25 (US$1.20) per litre in May 2026, the latest month NBS has reported. That is up 55.31 percent from ₦1,027.76 (US$0.77) a year earlier.
- —Dangote’s role The 650,000-barrel-per-day Dangote Refinery now supplies most of Nigeria’s petrol. It averaged roughly 31 percent of total supply between August 2024 and October 2025, and its share has grown fast since.
- —Fiscal shift The petrol import bill fell from US$14.06 billion in 2024 to US$10 billion in 2025, a saving of roughly US$4 billion.
- —The catch Despite the savings, no audited account links them to programmes for poorer Nigerians, fuelling public anger.
Three years after President Bola Tinubu declared the fuel subsidy gone, Nigerians are paying nearly seven times what they paid that month. The Dangote refinery has sharply cut Nigeria’s dependence on imported fuel, but it has not stopped repeated price shocks.
Dollar figures in this article use the CBN’s official exchange rate of ₦1,326.69 to the US dollar, published on 2 September 2026.
The announcement that changed Nigerian pump prices
President Bola Tinubu declared the subsidy gone on 29 May 2023, his inauguration day. The Nigerian National Petroleum Company Limited, or NNPCL, raised official pump prices within days.
The National Bureau of Statistics, or NBS, tracks the average retail petrol price nationwide each month. Its May 2023 reading, which already included a few days of post-announcement prices, was ₦238.11 (US$0.18) per litre.
By June 2023, the first full month after removal, the NBS average had jumped to ₦545.83 (US$0.41) per litre. That was a 129.23 percent rise in a single month.
The price climbed steadily through 2025
NBS data show the average price kept rising after that first shock. It reached ₦626.70 (US$0.47) per litre by August 2023 and ₦769.62 (US$0.58) by May 2024.
It peaked near ₦1,214.17 (US$0.92) in November 2024, then eased to ₦1,189.12 (US$0.90) in December. By May 2025, the NBS average stood at ₦1,027.76 (US$0.77) per litre.
A year later, in May 2026, the average reached ₦1,596.25 (US$1.20) per litre. NBS said that was a 55.31 percent year-on-year rise and a 4.13 percent rise from ₦1,532.93 (US$1.16) in April 2026.
Measured against the NBS’s own May 2023 reading of ₦238.11, that is a rise of about 570 percent over three years. That is well below the 800 percent figure sometimes quoted, which uses an older, unofficial 2023 price estimate.
Prices vary sharply by region
A working paper titled “From Pumps to Plates” tracked how unevenly the 2023 price rise reached different parts of Nigeria. Coastal markets near import terminals settled around ₦480 (US$0.36) to ₦520 (US$0.39) per litre after June 2023.
Remote northern markets, far from ports and refineries, saw prices above ₦650 (US$0.49) and sometimes above ₦800 (US$0.60) per litre. Distance from supply hubs, not just national averages, shaped how hard the reform hit ordinary households.
In its most recent report, for May 2026, the NBS put the North-West zone lowest, at ₦1,564.11 (US$1.18) a litre. It put the South-South zone highest, at ₦1,623.84 (US$1.22) a litre.
Dangote Refinery’s growing role
The Dangote Refinery in Lagos, widely called Africa’s largest, is a 650,000-barrel-per-day integrated complex. It began producing petrol in January 2024, ending Nigeria’s near-total reliance on imported fuel.
An Atlantic Post Nigeria analysis found that domestic refining supplied about 31 percent of Nigeria’s petrol between August 2024 and October 2025. Imports covered the rest of that period, but the balance has since shifted sharply toward Dangote.
By July 2026, industry regulator data reported by CED Magazine put domestic refineries at about 81 percent of supply. Imports had fallen to roughly 19 percent, far below the levels seen right after subsidy removal.
Fiscal savings, but limited transparency
Nigeria’s petrol import bill fell from US$14.06 billion in 2024 to US$10 billion in 2025, the Central Bank of Nigeria reported. That is a drop of about 29 percent, freeing up roughly US$4 billion in scarce foreign currency.
The federal government has not published a single audited account showing how those savings were used. Analysts have repeatedly called for clearer reporting on where the freed-up money went, whether to cash transfers, infrastructure or debt repayment.
Who gained, and who lost
The federal government gained fiscal room by ending a costly subsidy programme. The Dangote Refinery gained a fast-growing share of the domestic fuel market, reducing Nigeria’s exposure to imported fuel price swings.
Households and small businesses bore the immediate cost of higher pump prices. Transport operators passed higher costs on to passengers, and food prices rose as distribution costs climbed alongside petrol and diesel.
The political cost for President Tinubu
Repeated price increases between 2023 and 2026 have tested public patience with the reform. No major national strike reversed the policy, but labour unions and civil society groups have kept up pressure and criticism.
The unresolved question is whether the fiscal savings from subsidy removal will visibly reach ordinary Nigerians. That, more than the policy itself, has become the lasting political liability for the reform.
What three years of deregulation have shown
Subsidy removal did not deliver the stable, low pump price some officials once predicted. Instead, Nigeria moved from a regulated price near ₦185 (US$0.14) per litre to volatile prices that reached ₦1,596.25 (US$1.20) by May 2026.
Domestic refining has grown from a small share of supply in 2024 to roughly four-fifths of it by mid-2026. That is real progress, but Nigeria still depends on imports for the rest.
Whether the reform has truly benefited ordinary Nigerians remains an open question. Without a clear public account of the savings, that debate looks set to continue.
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