NIGERIANS are bracing for another round of economic hardship following President Bola Tinubu’s approval of a 15 per cent import duty on petrol and diesel, a move analysts warned could push pump prices up by between N100 and N200 per litre and further deepen the inflationary crisis already battering households and businesses.
The new tariff, according to The Cable, was announced in a letter dated October 21, 2025, and signed by Damilotun Aderemi, Private Secretary to the President, is scheduled to take effect 30 days after official notification. The policy aims to protect local refineries-particularly the Dangote Refinery-and promote domestic fuel production. However, critics argued that the timing could not have been worse for an economy already reeling from surging prices, naira depreciation, and stagnant wages.
Under the new arrangement, the Federal Inland Revenue Service (FIRS) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) will implement the duty applied to the Cost, Insurance, and Freight (CIF) value of imported petrol and diesel.
Izuchukwu Clement Igbanugo, founder of ACPAE Consulting Limited and former Head of Research at Financial Derivatives Company (FDC), faulted the government’s decision, describing it as ‘ill-timed and premature.’
‘We’ve always failed in policy sequencing due to impatience,’ Igbanugo said. ‘Why is Tinubu in a hurry? Why not wait for other refineries to come on stream before introducing this tax? Why not develop a modular refinery roadmap to support local producers first? This is like putting the cart before the horse.’
He stressed that Nigeria should first achieve self-sufficiency in fuel production before imposing restrictions on imports. ‘You cannot restrict imports before achieving sufficiency; you achieve sufficiency first and then impose restrictions. We must learn the art of policy sequencing-it’s better to avoid a storm than sail through it,’ he said.
Igbanugo warned that the tariff could raise pump prices to between N1,045 and N1,145 per litre, worsening the cost-of-living crisis. ‘Nigeria has the highest inflation rate among OPEC countries-over 20 per cent-nearly ten times higher than in countries like the UAE, Saudi Arabia, Algeria, Iraq, and Kuwait,’ he noted. ‘A 15 per cent gasoline tariff will raise the pump price by N100-N200 and further squeeze consumers.’
According to him, the current average pump price of N945 per litre already weighs heavily on households. ‘Compared with per capita income, the burden on an average Nigerian family is ten times that of an Algerian household and six times that of a household in Angola,’ he added.
Igbanugo cautioned that the new policy could foster monopoly, increase inflation, and deepen poverty. ‘Protectionism should come last and be strategic-not driven by the hunger for more money,’ he said, adding that Nigeria’s low energy access compounds the risk. ‘Energy consumption in Nigeria is just 136 kWh per person, compared to 5,000 in Malaysia and 3,400 in South Africa. About 92 million Nigerians-40 percent of the population-have no electricity. They rely on fuel for generators, and this policy will hurt small businesses the most.’
Akinjide Adeosun, Chairman and CEO of St. Racheal’s Pharmaceutical Nigeria Ltd, in an interview with Nigerian Tribune, argued that instead of taxing imports, the government should ban petrol importation altogether and focus on incentivizing local refining.
‘We must ban importation of petrol and ensure crude oil naira discounts for local refining firms like Dangote,’ Adeosun said. ‘The President must act because petrol pricing drives inflation. A 20 percent crude oil discount to local refiners or a ‘buy five barrels, get one free’ model could bring prices down.’
He also urged similar incentives for local manufacturers in sectors such as flour, cement, and agriculture, to tackle rising costs. Adeosun further called for death penalties for economic saboteurs, comparing Nigeria’s situation to strict anti-corruption measures in Singapore and China.
‘The government must make life easier for people at the grassroots by building schools, hospitals, and basic infrastructure,’ he said.
The new tariff followed a request by Zacch Adedeji, Executive Chairman of FIRS, who defended the policy as ‘corrective, not revenue-driven.’
Adedeji said the measure is meant to ‘align import costs with domestic realities while preserving affordability.’ He explained that payments will be made into a designated federal account and verified by the NMDPRA before fuel importers receive clearance.
According to him, even with the new tariff, Lagos pump prices will hover around N964.72 per litre ($0.62)-still below regional averages such as Senegal ($1.76), Côte d’Ivoire ($1.52), and Ghana ($1.37).
He added that the policy is backed by Sections 71 and 72 of the Petroleum Industry Act (PIA), empowering the NMDPRA to impose public service obligations and recover costs through levies. ‘Implementation will be transparent and digital. Customs and NMDPRA will update import templates and issue compliance notices to prevent speculation,’ he said.
Despite official assurances, citizens and experts alike warn that the new tariff could ignite another wave of price increases across sectors-from transportation and food to electricity and rent.
‘The impact of energy price changes on households will be severe,’ Igbanugo reiterated. ‘Gasoline and diesel are the oxygen of economic and private life in Nigeria. This policy, though well-intentioned, may suffocate struggling families and small businesses.’
Public reactions on social media mirrored this anxiety. On X (formerly Twitter), user @ennyolaoo15 criticized the decision, saying, ‘This 15 percent import tariff makes no economic sense when the FG can simply order NNPCL to phase out fuel importation. Over 90 per cent of imports already come through NNPCL, and this tariff will only raise their landing cost by nearly N100 per litre.’
Another user wrote: ‘Everyone’s focused on next year’s income tax hike but ignoring the one policy that will worsen transport costs, food inflation, and kill struggling SMEs – the 15 per cent fuel import tariff.’
As the 30-day countdown to the tariff’s implementation begins, Nigerians brace for yet another hike at the pump-an increase that could set off another cycle of inflation and economic strain in Africa’s largest oil-producing nation.