By Jimmy Fatunbi
Mounting tension from the ongoing conflict involving the United States, Iran and Israel has triggered fresh calls for economic relief measures in Nigeria as rising global crude oil prices push petrol costs to unprecedented levels.
Industry operators, economists, labour unions and private sector leaders have urged the Federal Government to channel the expected revenue windfall from higher crude prices into measures that would cushion the impact on citizens and businesses. They warned that the continued spike in fuel prices is already worsening economic hardship across the country.
Stakeholders called for urgent palliatives to mitigate the effect of rising prices of petrol, diesel and aviation fuel, noting that the trend could further destabilise Nigeria’s inflation rate. Some also suggested that the government consider temporary subsidies on petrol pump prices.
The appeals come as petrol prices reportedly range between N1,200 and N1,300 per litre in different parts of the country. Industry projections indicate that the price could surpass N1,500 per litre — and possibly approach N2,000 — if the Middle East crisis persists.
As the war involving the United States, Israel and Iran entered its third week without signs of de-escalation, concerns have grown that sustained increases in crude oil prices could push petrol beyond the reach of many Nigerians.
The Dangote Petroleum Refinery has attributed its recent increase in gantry prices to the geopolitical crisis, with prices rising from below N800 per litre before the conflict to about N1,175 per litre. Crude oil, which traded at about $68 per barrel before the escalation, climbed to around $103 as of Sunday evening.
Calls for tax cuts
In an interview with The PUNCH, the Independent Petroleum Marketers Association of Nigeria urged the Federal Government to reduce taxes and levies on petroleum products to bring down pump prices.
IPMAN spokesman, Chinedu Ukadike, said cutting certain statutory charges would help prevent further increases in petrol prices. According to him, fees from agencies such as the Nigerian Maritime Administration and Safety Agency, the Nigerian Ports Authority and the Nigerian Midstream and Downstream Petroleum Regulatory Authority contribute significantly to the final cost of fuel.
He noted that the management of the Dangote Petroleum Refinery recently disclosed that the facility pays more than 40 different charges and taxes to government agencies.
“The government should cut down some of these taxes, especially the NIMASA taxes and others. This will help reduce the price of petroleum products,” Ukadike said.
He also stressed the need to repair pipelines to lower the cost of transporting fuel nationwide, explaining that pipeline distribution is far cheaper than road haulage.
Ukadike added that even if the government cannot reintroduce petrol subsidies, it could revive the petroleum equalisation system to ensure uniform pricing across the country.
“With petroleum equalisation, the government can cover transportation costs so that fuel prices remain the same nationwide. Currently, petrol is more expensive in the North than in the Southwest, where the refinery is located,” he said.
He further advised the government to accelerate the deployment of vehicles powered by compressed natural gas (CNG) and expand access to conversion kits as a way of reducing transportation costs.
Ukadike also expressed hope that tensions in the Middle East would ease soon to stabilise global crude oil prices.
