Nigeria’s spending on imported refined petroleum products has dropped sharply, offering one of the clearest signals yet that the country’s long dependence on foreign fuel supplies is beginning to ease. New data from the Central Bank of Nigeria (CBN) shows that fuel import expenditure fell by 54 per cent within two years, declining from $14.58bn in the first nine months of 2023 to $6.71bn in the same period of 2025.
The figures, drawn from the CBN’s Balance of Payments (BoP) reports for 2023, 2024 and the third quarter of 2025, point to a sustained slowdown in fuel importation, driven by a mix of policy reforms, market adjustments and rising domestic refining capacity.
Fuel import bill halves in two years
A comparative analysis of the BoP data shows a clear downward trajectory. Between January and September 2024, Nigeria spent $11.38bn on refined petroleum imports, representing a $3.20bn or 21.9 per cent decline from the $14.58bn recorded in the same period of 2023.
The contraction deepened in 2025. Fuel imports dropped by a further $4.67bn, or 41 per cent, to $6.71bn within the first nine months of the year the steepest year-on-year decline across the period reviewed.
Overall, Nigeria spent $7.87bn less on refined fuel imports in the first nine months of 2025 than it did in the corresponding period of 2023, underscoring a significant easing of foreign exchange outflows tied to petroleum product imports.
CBN data also indicated a 41 per cent year-on-year decline in refined petroleum imports by the third quarter of 2025, signalling early signs of import substitution as new and rehabilitated refineries gradually ramp up operations.
Reforms, subsidy removal reshape demand
The sharp reduction in fuel import spending comes against the backdrop of sweeping structural reforms aimed at easing pressure on Nigeria’s external reserves and stabilising the naira.
For decades, the country relied heavily on imported refined products due to weak domestic capacity and chronic underinvestment in downstream infrastructure. This dependence made fuel imports one of the largest drains on foreign exchange earnings.
However, the removal of petrol subsidies in 2023 marked a major turning point. Higher pump prices curbed consumption and reduced arbitrage-driven demand, while stricter foreign exchange management by the CBN helped limit speculative FX demand linked to fuel importation.
At the same time, domestic supply has expanded, particularly in the downstream oil sector. Market competition has intensified as marketers increasingly contend with supply from the $20bn Dangote Petroleum Refinery in Lekki, which has begun supplying significant volumes of petroleum products into the local market.
Despite the gains, marketers still spent an estimated $6.71bn importing refined products during the review period, highlighting Nigeria’s continued though reduced reliance on foreign fuel supplies.
Experts urge caution on import ‘elimination’ claims
Energy economists warn that while Nigeria’s marginal dependence on imported fuel has declined, importation has not ended.
Renowned energy economist, Prof. Wumi Iledare, said claims that petrol imports have ceased entirely overstate market realities, despite improvements driven by local refining.
In a personal note titled “Dangote Refinery, Petrol Imports, and Market Reality,” Iledare explained that Nigeria’s downstream market remains anchored on import parity.
“Even when no petrol cargoes are landing, the credible threat of imports remains the market anchor,” he said, noting that importation still serves as a risk-management tool against demand surges, logistics disruptions and refinery operational risks.
He added that the Petroleum Industry Act entrenches liberalisation and competition, leaving no room for discretionary declarations that fuel imports have ended.
Similarly, the Chief Executive Officer of petroleumprice.ng, Jeremiah Olatide, described the 54 per cent drop in fuel import spending as a major shift, largely driven by growing local refining capacity.
“That’s a significant drop. It signals increased local production, largely championed by the Dangote Petroleum Refinery,” Olatide said, adding that the combination of local refining and residual imports is gradually strengthening Nigeria’s energy security.
Further analysis of the BoP data showed that refined fuel imports declined steadily through 2025, falling from $3.26bn in the first quarter to $1.80bn in the second quarter and $1.65bn in the third quarter.
However, Nigeria’s total import bill rose over the same period, driven largely by non-oil imports, while gas export earnings fell sharply due to infrastructure constraints and global market pressures.
Analysts say Nigeria’s transition to full energy self-sufficiency will remain incomplete until domestic refineries operate consistently at scale. Still, the latest data suggest that a long-standing pressure point in the economy fuel imports is finally beginning to loosen its grip.
