Still on Rising Fuel Prices

Nigeria’s latest fuel price shock — with Dangote Refinery raising its gantry price to N1,350 per litre on September 12 and pump prices climbing to N1,385 in Lagos and N1,430 in Abuja — is another painful reminder that economic reform is being felt most directly at the household level.

The federal government has consistently argued that market-based pricing and subsidy removal are necessary to restore fiscal stability. That argument is economically sound. But Nigerians are asking a legitimate question: how long must they bear the immediate costs of reforms whose promised benefits remain distant?

This latest adjustment, the fourth by Dangote Refinery in less than a month, has implications far beyond the filling station. Transport fares rise, the cost of moving farm produce increases, businesses spend more on logistics and diesel for power, and food prices come under fresh pressure. For millions whose incomes have not kept pace with inflation, another pump price increase is effectively another pay cut.

There is no denying Nigeria faces difficult choices. The old subsidy regime imposed a crushing burden on public finances, encouraged smuggling and exposed the economy to forex volatility. Moving towards domestic refining and transparent pricing can, in principle, strengthen the economy.

But sound reform must be judged by its impact on citizens, not just on government books.

It is not enough to point to improved revenues or reduced subsidy expenditure. The real test is whether ordinary Nigerians can afford food, transport, healthcare and housing. If reforms continually raise the cost of essentials without corresponding improvements in wages, productivity and social protection, public confidence will inevitably weaken.

The emergence of domestic refining led by Dangote Refinery offers a genuine opportunity. Nigeria can finally reduce its vulnerability to imports. But that opportunity must translate into greater price stability and availability. Currently, Nigerians are learning a hard lesson: local refining does not automatically mean cheaper fuel when crude prices are over $100 per barrel and the naira remains under pressure. The benefit of local refining is energy security, not immunity from the global market.

Government must, therefore, strengthen targeted relief for vulnerable groups — workers, farmers, transport operators and small businesses. Such interventions must be transparent, measurable and timely, not temporary political gestures.

It must also invest aggressively in alternatives that reduce petrol dependence: mass transit, CNG buses, rail freight, and public power supply. Every bus that moves on CNG is pressure taken off PMS demand.

And most importantly, it must entrench transparency. Nigerians deserve a clear breakdown of what determines pump price — crude cost, refining margin, exchange rate, logistics and taxes. When citizens understand price movements, they can hold institutions accountable and rumours give way to facts.

As we have argued on thia page before, our position remains that economic reform should not become synonymous with permanent hardship. Reform is meant to deliver a stronger economy capable of greater prosperity, not one in which citizens are endlessly asked to sacrifice.

Nigerians have shown remarkable resilience. They can endure difficult reforms when they are convinced sacrifice today will produce a better tomorrow. What they cannot accept is an endless cycle of higher prices, declining purchasing power and promises of future relief.

The federal government must ensure the burden of adjustment is shared fairly and that reforms are not only fiscally responsible, but socially sustainable. Success should be measured not merely in government accounts, but in the quality of life of the ordinary Nigerian.