Amanze Chinonye
The Federal Government has approved a 15 per cent ad valorem import duty on petrol and diesel imports but says the policy’s enforcement has been placed on hold until the naira appreciates and international oil prices decline.
President Bola Tinubu signed off on the new import tariff on October 21, 2025, as part of measures aimed at protecting domestic refiners such as the Dangote Refinery and reducing Nigeria’s long-standing dependence on imported fuel.
According to Prime Business Africa report, the 15 per cent duty applies to the cost, insurance, and freight (CIF) value of fuel imports.
Join our WhatsApp ChannelEstimates from industry data indicate that, once implemented, the levy could add between ₦99 and ₦100 per litre to landing costs potentially pushing pump prices toward or above ₦1,000 per litre, depending on exchange rates and logistics.
Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, clarified that the federal government would not implement the import duty immediately, noting that the timing must align with stronger macroeconomic conditions.
“The government recognises that Nigerians are already under severe cost pressures. The import duty on fuel will not be applied immediately; it will only take effect when the economy is stronger, the naira appreciates, and oil prices fall,” Oyedele said in Abuja.
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He explained that enforcing the policy now could aggravate inflation, which remains above 30 per cent, and increase transport and food costs nationwide.
Stakeholders in the downstream oil sector have expressed concern that the tariff, though designed to promote local refining, could further raise consumer prices if applied too soon.
Members of the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Nigerian Association of Road Transport Owners (NARTO) told reporters that any new levy on imports would “cascade through the supply chain,” adding to distribution costs and worsening inflationary pressures.
A senior petroleum marketer, who requested anonymity due to ongoing consultations with government regulators, said the move was “well-intentioned but risky under current market conditions,” citing continued currency volatility and high freight charges.
Government officials maintain that the new tariff is aimed at creating a level playing field for domestic refineries, preventing cheaper imported fuel from undercutting local production.
The Dangote Refinery, with a capacity of about 650,000 barrels per day, is central to this strategy, alongside the rehabilitation of the Port Harcourt, Warri, and Kaduna state-owned refineries currently under viability review.
According to officials, once Nigeria achieves sufficient refining capacity, the duty will help curb imports, conserve foreign exchange, and strengthen energy self-reliance.
While no enforcement date has been fixed, sources in the downstream sector said regulators had earlier discussed a 30-day transition window before the government decided to suspend implementation.
The Federal Inland Revenue Service (FIRS) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) are expected to handle administration when the policy eventually takes effect.
For now, consumers will continue paying market-determined prices, which remain vulnerable to exchange-rate fluctuations and global oil market trends.
Amanze Chinonye is a Staff Correspondent at Prime Business Africa, a rising star in the literary world, weaving captivating stories that transport readers to the vibrant landscapes of Nigeria and the rest of Africa. With a unique voice that blends with the newspaper's tradition and style, Chinonye's writing is a masterful exploration of the human condition, delving into themes of identity, culture, and social justice. Through her words, Chinonye paints vivid portraits of everyday African life, from the bustling markets of Nigeria's Lagos to the quiet villages of South Africa's countryside . With a keen eye for detail and a deep understanding of the complexities of Nigerian society, Chinonye's writing is both a testament to the country's rich cultural heritage and a powerful call to action for a brighter future. As a writer, Chinonye is a true storyteller, using her dexterity to educate, inspire, and uplift readers around the world.
