New 15% Import Duty on Petrol Sparks Concern in Nigeria
The recent decision by President Bola Tinubu to implement a 15% import duty on petrol has raised significant concerns among Nigerians. Analysts and representatives from labour unions have expressed worries that this move could lead to higher fuel prices, exacerbating the country’s cost-of-living crisis and being seen as an anti-people policy.
The directive was outlined in a letter dated October 21, addressed to the Federal Inland Revenue Service and the Nigerian Midstream and Downstream Petroleum Regulatory Authority, mandating the immediate enforcement of the new tariff. According to initial government projections, this duty could increase the landing cost of petrol by approximately N99.72 per litre, potentially raising pump prices in Lagos to around N964.72. For millions of Nigerians already grappling with high food prices, transportation costs, and unstable electricity supply, another rise in fuel prices could significantly impact their daily lives.
The government claims that the duty is part of broader efforts to enhance revenue. However, critics who have spoken with Saturday PUNCH argue that this measure will disproportionately affect low-income earners and could deepen inflation in a country where fuel costs influence nearly every aspect of the economy.
Marcel Okeke, former Chief Economist at Zenith Bank, warned that the tariff could trigger a new wave of cost-push inflation, where rising input costs lead to higher prices across the economy. He pointed out that while the government claims it wants to protect local refiners, the reality is that there are very few operational ones. Only Dangote has managed to survive, and even he has voiced complaints about sabotage.
Okeke argued that the government should focus on creating incentives for local refining rather than penalizing importers. “For a crude-rich nation like Nigeria, continuing to import petrol is an economic anomaly. It drains foreign exchange, weakens the naira, and keeps domestic prices tied to global oil volatility,” he said. He suggested that the government should instead create an environment where local refiners can thrive through incentives, tax relief, and better infrastructure, rather than imposing duties that distort the market.
Chris Onyeka, Assistant Secretary-General of the Nigeria Labour Congress, described the new duty as “anti-people” and accused the government of using protectionist rhetoric to justify a policy that ultimately benefits the Dangote Refinery. While the $20 billion Dangote Refinery is Nigeria’s only large-scale operational refinery, the country also has several state-owned plants under rehabilitation and a few small modular refineries in limited operation.
Onyeka questioned the rationale behind the policy, asking, “Public refineries are not working, and Dangote Refinery itself operates within an export processing zone and is not bound by Nigerian laws. If we’re talking about public refineries, those are dead. Or do they mean the small, illegal refineries in the creeks?”
He claimed the policy was designed to give Dangote an unfair advantage in the domestic market. “Dangote uses cheap Nigerian labour, refines locally, sells in naira, and saves on logistics. Yet imported petrol, refined abroad at higher costs, still lands cheaper. So who exactly are we protecting?” he asked.
Onyeka warned that the duty would inevitably be passed on to consumers, compounding inflation and increasing hardship. “Once importers pay duties, they add it to their cost, and the burden shifts to ordinary Nigerians,” he said. “There’s no real alternative; gas is expensive, electricity is unreliable, and the fallback is firewood. That’s not how to build a modern economy.”
He also accused the administration of paving the way for a monopoly. “Dangote did it with sugar and salt, and now it’s the same story with fuel. We warned that once his refinery becomes operational, public refineries would be sidelined, and that’s what’s happening now,” he said.