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Petrol Price Nears N1,300/Litre as Businesses Brace for Fresh Inflation Shock

Published by Samuel Ayomide on March 10th, 2026.

Businesses across Nigeria are preparing for a surge in operational costs following a sharp rise in petrol prices, which climbed to around N1,300 per litre in several parts of the country on Monday, sparking renewed concerns over inflation and economic stability.

Industry experts and representatives of the Organised Private Sector (OPS) have warned that the increase could trigger a ripple effect across the economy, raising transportation, logistics, and food distribution costs, which may ultimately push up the prices of goods and services nationwide.

The latest development follows a price adjustment by the Dangote Petroleum Refinery, which increased its gantry price of Premium Motor Spirit (PMS) from N995 to N1,175 per litre within a few days. The revision represents an increase of about N180, or roughly 18 percent, within three days.

Consequently, several filling stations across the country quickly adjusted their pump prices. In some areas, petrol was sold between N1,250 and N1,400 per litre as marketers reacted to the rising depot prices.

Industry checks also revealed that some retail outlets in major cities raised prices almost immediately after the new rate was communicated to marketers and depot operators.

A senior refinery official confirmed that the adjustment was driven by prevailing global market conditions and rising replacement costs for crude oil and petroleum products.

According to the official, volatility in international oil markets has significantly increased operational expenses, forcing refineries to reflect the changes in domestic pricing.

The global oil market has been experiencing turbulence in recent days, largely linked to geopolitical tensions in the Middle East involving Iran, Israel, and the United States. The crisis briefly pushed crude oil prices close to $120 per barrel before easing to about $98 later in the day.

The Managing Director of Dangote Petroleum Refinery, David Bird, defended the adjustment, stating that the refinery operates within the global commodity market and is not insulated from international price fluctuations.

He explained that although Nigeria produces crude oil locally, refineries still purchase crude at international benchmark prices, even under arrangements designed to facilitate domestic supply.

Bird noted that rising freight charges, insurance costs, and financing expenses have further intensified pressure on petroleum prices. Shipping costs alone, he said, have surged from roughly $800,000 per cargo to nearly $3.5 million in the current market environment.

Despite the price adjustments, the refinery maintained that its operations continue to provide stability to Nigeria’s fuel supply by preventing shortages during periods of global disruption.

Meanwhile, the Independent Petroleum Marketers Association of Nigeria (IPMAN) said the current spike in fuel prices may be temporary and linked to international developments. According to the association, prices are likely to decline once global crude prices stabilise after the ongoing geopolitical tensions ease.

Economists and business leaders, however, warned that the immediate impact on Nigeria’s domestic economy could be severe.

The Director-General of the Lagos Chamber of Commerce and Industry, Dr. Chinyere Almona, noted that rising fuel costs are already affecting logistics across the country, particularly in the transportation of food and essential goods.

She explained that increased fuel prices inevitably raise the cost of distributing agricultural produce and manufactured items, which could reverse recent gains in moderating inflation.

Almona also cautioned that disruptions in global shipping routes due to the Middle East crisis may increase freight costs for imported goods, adding further pressure on consumer prices.

Similarly, the Director-General of the Nigeria Employers’ Consultative Association, Adewale Oyerinde, said higher energy costs often translate directly into increased production and distribution expenses for businesses.

According to him, sectors such as agriculture, manufacturing, and logistics are particularly vulnerable to fuel price increases, as transportation costs form a significant portion of their operating expenses.

Small business operators have also expressed concern over the development. The President of the Association of Small Business Owners of Nigeria, Dr. Femi Egbesola, warned that the current trend could worsen inflation and erode the purchasing power of ordinary Nigerians.

He explained that energy costs remain one of the most significant drivers of inflation because petrol and diesel are used across virtually every sector of the economy.

“When fuel prices rise, transportation costs increase immediately, and that inevitably leads to higher prices for goods and services,” he said.

Labour leaders also criticised the persistent increases in petrol prices. The Nigeria Labour Congress (NLC) argued that the current situation highlights structural weaknesses in Nigeria’s downstream petroleum sector, particularly the country’s limited domestic refining capacity.

According to the labour union, continued exposure to global oil market shocks demonstrates that Nigeria still relies heavily on imported refined products despite recent investments in local refining.

Economists also noted that Nigeria’s status as an oil-producing nation has not shielded it from global price shocks due to inadequate domestic production of refined petroleum products.

Analysts warned that if the current geopolitical tensions persist and global crude prices continue to climb, petrol prices in Nigeria could rise even further, placing additional strain on businesses and households already grappling with high living costs.

Industry groups have therefore urged the Federal Government to accelerate efforts to strengthen domestic refining capacity and support local refineries as a long-term strategy to reduce Nigeria’s vulnerability to international market disruptions.