• Global oil prices surge as Strait of Hormuz tensions threaten further supply disruptions
  • Dangote refinery raises gantry price from N1,265 to N1,350 per litre
  • Transport fares surge by up to 100% on Lagos-Ogun routes
  • Economists warn higher fuel costs could accelerate inflation

Nigerians face renewed pressure on household budgets as petrol prices climbed sharply across major markets over the weekend, with pump prices reaching as high as N1,430 per litre in some locations.

The increase came after the Dangote Petroleum Refinery raised its gantry price for Premium Motor Spirit (PMS), popularly known as petrol, from N1,265 to N1,350 per litre.

The N85 increase, representing about 6.7 per cent, came amid a sharp rise in international crude oil prices and heightened geopolitical tensions in the Middle East, particularly around the Strait of Hormuz.

The timing has also drawn attention because the petrol price increase coincides with the high-profile Dangote Refinery public offering, scheduled to be unveiled on Tuesday, September 15, 2026.

The combination of higher fuel prices and rising international crude prices has renewed concerns that Nigerians could face another wave of increases in transportation, food, logistics and other essential goods.

Transport fares jump

The immediate impact was particularly visible in the transport sector, where commuters travelling between Ogun State and Lagos were confronted with steep fare increases on Sunday.

Routes that previously cost between N200 and N500 reportedly rose to between N500 and N1,200, leaving some commuters unable to continue their journeys because they had not budgeted for the sudden increase.

On the Mowe-Oshodi and Mowe-Mile 2 routes, for example, fares that were previously around N400 to N500 reportedly climbed to about N1,000.

A commuter who travelled on the route expressed concern about what fares would look like when the new week began.

“What the price would be tomorrow morning, Monday, only God can tell,” the commuter said.

The development highlights the sensitivity of Nigeria’s transport system to petrol prices. With millions of commuters relying on road transportation, even modest increases in fuel costs can quickly translate into higher fares.

Food prices under renewed pressure

The latest petrol increase could also feed directly into food inflation.

A significant proportion of agricultural produce consumed in Nigeria is transported by road from farms and rural production centres to urban markets. Trucks, buses and other vehicles depend heavily on petrol and diesel.

Higher fuel costs therefore increase the cost of moving food from farms to wholesalers, markets and consumers.

The result could be another round of price increases for food and other essential commodities at a time when households are already struggling with elevated living costs.

Economists warn that the impact could extend beyond transportation and food.

Manufacturers, distributors, retailers and service providers also incur transportation and energy costs. As these costs rise, businesses are likely to pass part of the additional burden to consumers.

Petrol prices rise across major cities

Checks in Lagos, Ogun State and the Federal Capital Territory showed that several filling stations had adjusted their pump prices upwards.

In Abuja, MRS retail outlets increased their pump price from about N1,350 to N1,395 per litre, while NIPCO outlets raised prices to about N1,430 per litre.

Some Mobil outlets also increased their prices to approximately N1,400 per litre.

A petrol attendant at an MRS outlet, who requested anonymity, said motorists could face another increase as stations replenish their stocks.

“We are currently selling our old stock at N1,395 per litre, but from tomorrow, once the new stock arrives, the price will be higher,” she said.

The latest Dangote adjustment also means the refinery’s wholesale price is now above the reported petrol landing cost of about N1,311 per litre, increasing the pressure on downstream operators.

Global oil shock adds to pressure

The domestic price increase is taking place against the backdrop of a significant surge in international oil prices.

Brent crude, the global benchmark and reference price for Nigerian crude, has traded above $100 per barrel, with prices recently moving towards the $108 per barrel range.

The rise has been driven largely by escalating geopolitical tensions in the Middle East and concerns about disruptions to crude oil and refined-product shipments.

Oil markets have become particularly sensitive to developments around the Strait of Hormuz, one of the world’s most important energy chokepoints.

The waterway carries a substantial share of global oil and liquefied natural gas shipments. Any prolonged disruption could therefore have consequences far beyond the Middle East.

Reports of attacks involving vessels and energy infrastructure, together with uncertainty over diplomatic efforts involving Iran and Gulf states, have added to market volatility.

The reported attacks on Saudi Arabia’s East-West Pipeline have also heightened concerns about alternative routes for moving crude outside the Strait of Hormuz.

Market participants are increasingly focused on whether Saudi Arabia can restore the affected pipeline’s full throughput and whether diplomatic efforts can reduce the risk of further disruptions.

Economists warn of fresh inflationary pressure

Dr Aliyu Ilias, an economist and development expert, warned that higher petrol prices could worsen inflation and deepen economic hardship.

He said the increase would likely raise transportation and production costs, particularly for food and other essential commodities.

“There should be a way of absorbing these costs. If you do not absorb them, they will show up in our next inflation figures and economic analysis,” Ilias said.

He noted that rising transportation costs have a multiplier effect across the economy because businesses depend on logistics to move raw materials and finished products.

“The more prices increase, the more the cost of producing goods, especially food, will rise because everything is affected by transportation costs,” he said.

Calls for stronger policy response

Former Secretary-General of the Organisation of African Trade Union Unity (OATUU), Owei Lakemfa, said Nigeria needed stronger economic planning and regulatory mechanisms to protect consumers from sudden international oil-price shocks.

Lakemfa argued that Nigeria’s status as a major crude oil producer should provide some protection against the full impact of international fuel-market volatility.

He said domestic refining should reduce Nigeria’s exposure to international shipping, insurance, labour and other costs associated with importing refined petroleum products.

“If we produce oil in Nigeria, refining in Nigeria cannot be the same as importing fuel,” he said.

Lakemfa also questioned the structure of Nigeria’s downstream petroleum market, arguing that excessive market concentration could give major players significant influence over the pricing of a critical commodity.

He called on regulators and consumer protection agencies to prevent arbitrary price increases and ensure that movements in global crude prices do not automatically translate into equivalent increases in domestic petrol prices.

Marketers seek stability

The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, said marketers had adjusted pump prices in response to successive changes in Dangote Refinery’s pricing.

He said frequent price changes were creating uncertainty for both marketers and consumers because the cost of replacing existing stocks could change rapidly.

The development illustrates the new dynamics of Nigeria’s deregulated downstream petroleum market, where domestic fuel prices are increasingly influenced by crude oil prices, exchange-rate movements, refinery pricing and market competition.

Pressure point for the economy

The latest petrol increase presents a fresh challenge for an economy already battling to bring inflation and household costs under control.

For consumers, the most immediate concern is not simply the price displayed at filling stations. It is the wider cost impact — from commuting to work and moving agricultural produce to transporting manufactured goods across the country.

The situation also exposes the continuing vulnerability of Nigeria’s economy to international energy shocks despite the emergence of a major domestic refinery.

Domestic refining can reduce dependence on imported petrol and eliminate some shipping and foreign-exchange costs, but refiners remain exposed to the international price of crude oil, unless there are mechanisms that significantly insulate domestic prices from global market swings.

With Brent crude trading above $100 per barrel and tensions around key Middle East shipping routes still unresolved, further pressure on domestic fuel prices cannot be ruled out.

For Nigerian households and businesses, that raises the prospect of higher transport and logistics costs — and another round of pressure on food prices — unless global oil markets stabilise or domestic supply conditions improve significantly

With an additional report from NAN