FG Predicts Sustained Decline in Petrol, Diesel and LPG Prices Nationwide

The Federal Government has projected a sustained reduction in the prices of petrol, diesel and Liquefied Petroleum Gas (LPG) across Nigeria, citing improved supply, growing competition and increased private sector investments in the oil and gas industry. The assurance was given by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which maintained that market forces are gradually stabilising energy prices following the removal of fuel subsidy.

Speaking during an inspection tour of Aradel Holdings Plc facilities in Ogbele community, Ahoada East Local Government Area of Rivers State, the Chief Executive of NMDPRA, Mr. Saidu Mohammed, said Nigerians should expect further relief as supply continues to improve nationwide. According to him, the deregulation of the downstream sector has created an enabling environment that encourages efficiency, competition and long-term investments.

Mohammed explained that the relationship between supply and price is already playing out in the market, noting that petrol prices have declined significantly in recent months. “The more supply we have, the lower the price, and this is already evident. Petrol has dropped from around ₦1,000 per litre to about ₦800 due to increased competition,” he said. He added that similar trends would be observed in diesel and LPG as more products enter the market.

The NMDPRA boss argued that the removal of fuel subsidy, though initially painful, was necessary to allow market forces to function properly. He stressed that subsidies often distort supply chains, encourage inefficiency and discourage private investment. “Sustained competition, rather than subsidies, will guarantee adequate supply of petrol and gas at affordable prices for Nigerians,” Mohammed stated.

He further emphasised the need for Nigeria to expand its refining capacity beyond current levels, particularly through refineries with advanced conversion capabilities. Such facilities, he said, would be able to produce a wider range of products including diesel, fuel oil, naphtha, LPG and petrol, thereby reducing dependence on imports and exposure to foreign exchange volatility.

According to Mohammed, Nigeria’s long-term vision goes beyond domestic consumption. He revealed that the country is positioning itself to become a major exporter of petroleum products to Africa, Europe and the Americas. However, he noted that local demand must first be adequately met before large-scale exportation can commence, in order to avoid domestic shortages and price shocks.

Commenting on the policy direction of the current administration, Mohammed said President Bola Ahmed Tinubu’s commitment to a free-market economy has been instrumental in reshaping the oil and gas sector. He recalled that the removal of fuel subsidy was the president’s first major policy decision, describing it as a bold move that unlocked private sector participation and stimulated investments across the entire value chain.

On the state-owned refineries, Mohammed clarified that their operational status largely falls under the responsibility of the Nigerian National Petroleum Company Limited (NNPCL). However, he said the NMDPRA is actively engaging with NNPCL to ensure the steady delivery of crude oil and refined products to the Port Harcourt and Warri refinery reserves. According to him, restoring loading activities at these facilities would boost local economies and revive petroleum distribution in host communities.

“Once product loading resumes, Nigerians will begin to feel the economic impact, even before full refinery operations,” he said, adding that such developments would improve availability and help moderate prices.

Mohammed also described the midstream sector as Nigeria’s strongest driver of economic growth, with the capacity to stimulate manufacturing, power generation, transportation and other productive sectors. He noted that facilities inspected during his three-day operational tour of Rivers State demonstrated that Nigerians have the technical and financial capacity to design, build and operate world-class energy infrastructure sustainably.

He singled out Aradel Holdings as a model indigenous company, noting that it has successfully operated a refinery without foreign operatorship. He disclosed that Aradel currently runs an 11,000-barrel-per-day refinery, supplies gas to Nigeria Liquefied Natural Gas (NLNG), and operates a virtual gas pipeline distributing compressed natural gas across several parts of the country. He added that the company’s ongoing expansion would enable the loading of petrol from its facility before the end of 2027.

Responding, the Managing Director of Aradel Holdings, Mr. Adegbite Falade, thanked the NMDPRA for its regulatory support and expressed the company’s commitment to expanding refining capacity, commercialising gas resources and eliminating routine gas flaring. He assured Nigerians that Aradel is prepared to meet rising demand and contribute meaningfully to solving the country’s energy challenges.

Despite the optimism expressed by government officials, the announcement has continued to generate mixed reactions among Nigerians, many of whom remain sceptical due to past experiences. Critics argue that the recent price reductions are politically motivated, coming as the 2027 general elections draw closer, while others insist that true reform can only be judged by sustained affordability and improved living standards.

Nevertheless, the Federal Government insists that the downward price trend is market-driven and sustainable, maintaining that increased local production, competition and private investments will ultimately deliver long-term stability in Nigeria’s energy sector.