Rising Petrol Prices: FG Unveils 10 Measures To Cushion Impact
The Federal Government has announced 10 measures to cushion the impact of rising petrol prices and protect households, businesses and transport users from further price shocks.
The measures were outlined by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, on Thursday during a press briefing on fuel prices and the subsidy question in Abuja.
The government said the measures were designed to ease the immediate burden of higher petrol prices without returning to a blanket fuel subsidy.
Here are the 10 measures announced by the Federal Government:
- 30-day petrol discount at NNPC stations
The government will offer a margin discount on petrol dispensed by the Nigerian National Petroleum Company Limited for the next 30 days.
“We are offering a discount on petrol dispensed by NNPC Limited for the next 30 days, with priority for public transporters nationwide,” Oyedele said.
Oyedele said the measure was not a return to subsidy, explaining that the government would effectively allow petrol to be sold at cost under the arrangement.
- Forward sales of crude to local refineries
The government said it would increase forward sales of crude oil to domestic refineries as production rises.
According to Oyedele, this would free up committed crude supplies and help shield domestic petrol prices from fluctuations in the international market.
- N1,350 ceiling on petrol landing cost
The government is negotiating a ceiling of N1,350 per litre on the ex-gantry or landing cost of petrol.
Under the proposed arrangement, refiners and importers would absorb any shortfall when costs rise above the ceiling and recover the difference when crude prices or the exchange rate become more favourable.
Oyedele said, “The government is negotiating a ceiling of 1,350 naira a litre on the ex-gantry or landing cost of petrol, to keep pump prices stable. Where costs rise above the ceiling, refiners and importers will carry the shortfall and recover it later, when crude prices or the exchange rate allow, without breaching the ceiling.
“This is neither a subsidy nor a price control: it is designed to smooth prices over time rather than suppressing them. The reasoning is simple. 1,400 naira a litre today and 1,400 tomorrow is better than 1,500 today and 1,300 tomorrow, because volatility itself adds to uncertainty and cost.
“And when fares go up sharply, they rarely come down as fast. The ceiling will be reviewed every month, reset where costs require, and the figures published for transparency.”
- Removal of illegal levies
The Federal Government plans to work with states to rein in illegal road taxes and levies that increase the cost of transporting goods and services.
Oyedele said the move would be pursued under the 2025 tax reform laws.
- More direct support for vulnerable Nigerians
The government said it would increase cash transfers to vulnerable households as part of efforts to cushion the effect of higher fuel prices.
It will also provide subsidised credit to small businesses and consumers.
- Faster rollout of CNG vehicles
The government said it would accelerate the deployment of compressed natural gas vehicles across the country.
It said federal and state governments would support the rollout, while transport operators would be encouraged to pass the savings from CNG use on to passengers.
- Excess profit tax
The Federal Government said it would consider an excess profit tax for operators found to be taking undue advantage of the situation anywhere along the energy value chain.
“The proceeds will be used exclusively to cushion the impact of fuel prices, through transport support or vouchers for urban minimum wage earners who are the most vulnerable,” he said.
The government also plans to work with the National Assembly on enhanced tax relief for low-income earners under the 2027 Finance Bill.
- Reduction of regulatory costs
The government said it would reduce unnecessary regulatory requirements and costs that add to the expenses of businesses and ultimately push up the prices of goods and services.
- National Strategic Fuel Reserve
The government plans to establish a National Strategic Fuel Reserve to improve supply security and reduce the impact of global disruptions.
Oyedele added, “Refined products will be released into the market under clear, published rules whenever a global disruption or hoarding threatens supply and price stability.
“This is not a subsidy and it does not fix prices, rather it secures supply and reduces price volatility. It will prevent artificial scarcity, deter market manipulation and anchor long-term energy security, so that a deregulated market delivers stable growth and not sudden price shocks.”
- Better traffic and logistics management
The government said it would improve traffic management in urban areas to reduce fuel consumption and cut logistics costs.
It also plans to use NIPOST address codes to make logistics operations more efficient and cheaper.
The measures come as petrol prices have risen following higher international crude and refined-product prices, with the government saying it does not intend to return to a blanket fuel subsidy.
Oyedele said the government would instead use targeted measures to support those most affected while protecting the wider economy.
“To be perfectly clear, none of these measures restores a blanket subsidy. To do so would amount to creating longer-term harm for a short-term cure. Each measure is designed to reach the people who need help, without putting the wider economy at risk,” he said.
