In a landmark shift for Nigeria’s energy sector and broader economy, diesel prices at the depot have fallen below ₦1,000 per litre the lowest level recorded in over two years. Checks into Petroleumprice.ng confirms between 995-999 across various depots in Nigeria, a new average price of ₦950 per litre across major depots, signalling a significant reduction from the peak of ₦1,400/L seen in 2023.
A development is being lauded as a much-needed reprieve for businesses, logistics operators, farmers, and households that rely heavily on diesel for transportation, manufacturing, agriculture, and off-grid power supply amid ongoing electricity shortages.
Key Drivers Behind the Price Decline
Global crude oil surplus
A major contributor to this diesel price crash is the current oversupply of crude oil on the global market. Top-producing nations including the United States, Saudi Arabia, and Russia have significantly ramped up output, leading to a glut that has pulled down the cost of refined products like diesel. While Nigeria exports crude, it remains a net importer of refined fuels, meaning cheaper international prices offer short-term advantages.
Increased local supply and refinery improvements
Domestic refinery activity has shown notable progress. Modular refineries and imports from regional partners have improved supply reliability, while the long-anticipated operations at Dangote Refinery are poised to stabilise the market further. The facility, designed to process 650,000 barrels per day, is expected to reduce Nigeria’s dependency on fuel imports in the coming months.
Naira stability and supportive fiscal policies
The Central Bank of Nigeria’s recent efforts to defend the naira, along with temporary relief on fuel import duties and taxes, have softened forex-related cost pressures. The Nigerian National Petroleum Company Limited (NNPC) has also been proactive in ensuring seamless fuel importation and distribution, particularly for diesel and aviation fuel.
Reduced domestic demand
Diesel consumption has been slightly dampened by slowing activity in heavy industries and commercial sectors, many of which have scaled back operations due to economic uncertainties. This decline in demand has further eased pricing tension at the wholesale level.
Market Data Snapshot
Depot-level diesel prices as of today are as follows:
- IBETO: ₦ 995 (-0.3)
- Emadeb: ₦998 (−0.1%)
- Wosbab: ₦998 (−0.2%)
- A.A Rano: ₦998 (−0.2%)
These prices reflect consistent downward movement across key marketers, confirming a widespread reduction in depot-level diesel rates.
Economic Impact and Sectoral Relief
Transport and logistics sector to benefit
The transport and haulage industry, where diesel is the dominant fuel source, is expected to be the biggest immediate beneficiary. Fleet operators, distribution companies, and independent transporters can now project lower fuel expenses a development likely to bring down freight costs and, indirectly, reduce the prices of consumer goods.
SMEs and households gain breathing space
In urban and rural areas alike, small and medium enterprises (SMEs) reliant on diesel generators now see a pathway to reduced operational costs. Nigeria’s persistent grid instability has made diesel a cornerstone of energy supply for businesses and residential estates. A lower diesel price translates to decreased expenditure and greater business viability for many local operators.
Agricultural productivity to rise
Farmers using diesel-powered irrigation systems, tractors, and post-harvest equipment also stand to benefit. With agriculture accounting for over 25% of Nigeria’s GDP, easing fuel prices can play a key role in stabilising food production and pricing. This is particularly crucial as the country battles persistent inflation in food and transport sectors.
Public Sentiment and Industry Reactions
Many marketers and citizens have responded positively to the drop in prices. A depot marketer was quoted saying:
“As at year 2023 we were selling diesel for ₦1,500 from petroleum depot, but as at this morning diesel is selling for ₦993, we are happy about this development.”
This sentiment reflects the collective sigh of relief across industries and households alike.
Conclusion: A Rare Window for Economic Relief
The fall of diesel prices below ₦1,000 per litre is more than a statistical anomaly it’s a turning point for Nigeria’s fuel-dependent economy. While the broader impact will unfold over the coming weeks, the price dip already offers a hopeful signal amid the prevailing cost-of-living crisis.
The challenge now lies in maintaining this trend while ensuring energy security, fair distribution, and long-term stability in the downstream sector.
