Petrol landing cost in Nigeria has soared to a staggering ₦880.59 per litre at key terminals such as the Nigerian Pipelines and Storage Company (NPSC) and Nigerian Oil Jetty (NOJ) in Apapa, Lagos. This jump, among the highest since the mid-2023 subsidy removal, is driven by a combination of factors chiefly, a spike in global crude prices and sustained naira depreciation.
Breaking Down the Surge in Costs
According to the latest Energy Bulletin from the MEMAN Competency Centre (April 22, 2025), the Import Parity Cost (IPC) for petrol at Apapa is based on a spot exchange rate of ₦1,602.63 to $1. With Brent crude currently averaging $67.44 per barrel and ICE Gasoil Futures at $630.25/MT, the landing cost incorporates freight, insurance, terminal charges, and other associated costs.
- Spot Landing Cost (NPSC – NOJ): ₦880.59/litre
- 30-Day Average: ₦855.80/litre
- Alternate Spot (ASPM): ₦880.47/litre
This rising cost structure has pushed marketers to the edge, as many are forced to sell below cost, thereby accumulating heavy losses.
Marketers Reeling from Losses
Industry insiders confirm that most marketers are grappling with unsold stock bought at higher rates. With no government-backed foreign exchange (FX) window and limited access to local refining alternatives, these players are bleeding cash.
“Selling at or below ₦850 when the landing cost is ₦880 means we’re bleeding money on every litre,” said one depot operator anonymously.
Retailers now bear the burden of what appears to be a shadow subsidy. The disparity between deregulated pump prices and actual import costs has led to credit-based operations, product hoarding, and shrinking margins, resulting in sporadic fuel shortages in the hinterlands.
Dangote Factor: A Partial Relief
The entrance of Dangote Refinery offered a brief respite. When Dangote began supplying petrol, its gantry price dropped to around ₦835/litre (inclusive of regulatory charges). However, marketers argue that the refinery’s output is still not accessible to all, due to logistical limitations and restricted allocation volumes.
Many marketers had already stocked up at higher import rates before Dangote’s supply began, causing massive losses when resale prices failed to reflect the updated, lower rates.
Additionally, Dangote’s inability to service coastal delivery means that trucking costs to inland depots add further pressure to the final pump price.
Implications and the Way Forward
This latest spike in petrol landing cost presents a significant challenge to the Federal Government’s market liberalization agenda. While efforts to localize refining through Dangote’s operations and modular refineries are commendable, Nigeria’s dependence on FX for imports remains a critical vulnerability.
With ICE Gasoil prices still hovering above $630/MT and the naira’s instability continuing to weigh down margins, stakeholders are calling for:
- Transparent pricing models
- Access to FX at regulated rates for genuine marketers
- Expanded distribution from local refiners
Without decisive action, Nigeria may face another cycle of fuel scarcity, prolonged queues, and stunted economic activity just as demand spikes with upcoming holidays and farming logistics.
