By Adeola Kunle
Nigerians spent an estimated N11.3 trillion on Premium Motor Spirit, popularly known as petrol, between January and July 2026, as rising pump prices continued to increase the cost of transportation and private electricity generation.
Data contained in the July 2026 Midstream and Downstream Petroleum Statistics released by the Nigerian Midstream and Downstream Petroleum Regulatory Authority showed that about 10.37 billion litres of petrol were supplied to the domestic market during the seven-month period.
An analysis of the monthly volumes alongside prevailing average pump prices indicates that consumers paid approximately N11.3tn for the product between January and July.
Petrol remains Nigeria's most widely used automotive fuel, powering cars, buses, motorcycles, tricycles and many electricity generators. Diesel, by comparison, is used largely by trucks and industrial operators.
The removal of petrol subsidy by President Bola Tinubu in 2023 resulted in a major increase in pump prices, with petrol rising from about N175 per litre to as much as N1,310 per litre.
Rising Prices, Lower Demand
The NMDPRA figures showed that Nigerians spent more than N1tn on petrol in every month between January and July, despite a gradual decline in the quantity consumed.
Petrol sold at an average of N830 per litre in January and February, before the average price increased to N1,100 in March, N1,250 in April and N1,300 in May. The average price later eased to N1,200 per litre in June and July.
The increase in prices occurred amid heightened geopolitical tensions involving the United States and Iran. Despite the resulting pressure on consumers, Nigerians continued to spend heavily on petrol even as demand weakened.
In January, approximately 1.87 billion litres were consumed, translating to about N1.55tn in expenditure.
Consumption declined to 1.59 billion litres in February, while expenditure stood at approximately N1.32tn.
In March, Nigerians consumed around 1.47 billion litres, spending about N1.61tn.
April recorded consumption of approximately 1.53 billion litres, but the higher pump price pushed the monthly expenditure to N1.92tn.
In May, about 1.44 billion litres were consumed at a total cost of approximately N1.87tn.
June consumption stood at roughly 1.42 billion litres, with consumers spending about N1.71tn.
July recorded the lowest monthly consumption within the seven-month period, at approximately 1.11 billion litres, yet Nigerians still spent about N1.33tn on petrol.
The figures illustrate the growing impact of higher petrol prices on households and businesses. Even with consumption falling considerably from the beginning of the year, the country's total petrol expenditure remained above N11tn.
Petrol Demand Drops Sharply
The decline in consumption became more pronounced in July, when average daily petrol demand fell to 35.7 million litres.
That figure represented a 24.7 per cent decline from the 47.4 million litres consumed daily in June and was 24.4 per cent lower than the 47.2 million litres recorded daily in July 2025.
July's average was also 44 per cent below the peak daily consumption of 63.7 million litres recorded in December 2025.
The 35.7 million litres consumed per day in July was 28.6 per cent below Nigeria's 50-million-litre daily petrol demand benchmark.
It was also approximately 29.4 per cent lower than the 50.6 million litres per day average recorded over the 13-month period covered by the July statistics.
The sharp fall in petrol demand contrasted with the performance of some other petroleum products.
Diesel consumption reached 14.7 million litres per day in July, slightly above the 14-million-litre daily benchmark, representing a five per cent increase over the benchmark.
Liquefied Petroleum Gas, commonly called cooking gas, also exceeded its benchmark, with consumption reaching 4.4 kilotonnes per day, compared with the benchmark of 3.9 kilotonnes. This amounted to a 12.8 per cent increase.
Aviation fuel, however, recorded a significant decline. Its consumption stood at 1.7 million litres per day, which was 43.3 per cent below the three-million-litre daily benchmark.
Overall, the downstream petroleum market showed mixed trends, with petrol and aviation fuel falling substantially below their benchmarks while diesel and LPG remained above theirs.
For petrol specifically, July's figure represented the lowest daily consumption on the July 2025-July 2026 chart.
Renewed Debate Over Petrol Subsidy
The rising cost of petrol has renewed calls for government intervention, with energy experts and economists recently supporting former Vice-President Atiku Abubakar's proposal for a review of the Federal Government's petrol subsidy policy.
The experts urged the administration to consider targeted measures capable of reducing the pressure created by the removal of the subsidy.
However, they cautioned against returning completely to the former subsidy system, arguing that any intervention should be accompanied by transparency, accountability and effective implementation.
They maintained that although subsidy removal was considered necessary, its consequences had not been adequately managed, particularly the resulting increases in petrol, transportation, food and other essential costs.
The Chief Executive Officer of Petroleumprice.ng, Olatide Jeremiah, said the current petrol price was excessively high for a country where many citizens face severe economic hardship.
Jeremiah argued that government intervention was necessary to prevent the high cost of fuel from further worsening living conditions.
He suggested that part of the revenue generated from crude oil sales could be channelled towards reducing the cost of petroleum products.
He also pointed to measures adopted by other countries during the US-Iran geopolitical crisis, arguing that government intervention had helped some nations control petroleum prices while awaiting a resolution of the crisis.
Energy economist Prof. Adeola Adenikinju said a production subsidy would be preferable to a consumption subsidy in principle, although he warned that Nigeria's history of vested interests could create challenges for such a system.
Adenikinju also called for greater investment in mass transportation, saying an effective public transport system could reduce the burden of high fuel costs on households and support economic activity.
He criticised the Federal Government's Compressed Natural Gas intervention as inadequate, particularly because CNG facilities and buses remain limited in many locations.
According to him, the insufficient availability of CNG-powered buses means the initiative has not yet provided enough relief for low-income Nigerians facing rising transportation costs.
The continuing debate over petrol subsidy comes as the Federal Government faces growing pressure to demonstrate how savings from the subsidy removal have translated into tangible benefits for ordinary Nigerians.
Adeola Kunle
No comments:
Post a Comment