A public policy analyst, Rotimi Matthew, and several operators in Nigeria’s oil and gas sector have criticised the Federal Government’s proposed 15 per cent tariff on fuel imports, describing it as an ill-timed policy that could deepen economic hardship, raise fuel prices, and strengthen monopoly control in the petroleum downstream market.
The controversial tariff proposal, which the government defended in a recent policy memo, is intended to promote local refining, enhance energy security, and stabilise the market. However, experts and market players have dismissed these claims, saying the policy will make petrol more expensive and limit competition at a time when Nigerians are already battling record-high pump prices.
In the memo, the government argued that the 15 per cent duty on imported petroleum products would encourage investment in local refineries such as the Dangote Petroleum Refinery, while reducing overdependence on imports. But Matthew, in a statement obtained by our correspondent, described the justification as “deeply flawed and economically dangerous.”
“The Dangote Petroleum Refinery currently produces far below Nigeria’s 66 million-litre daily demand, yet the government wants to tax the imports that actually keep vehicles running,” Matthew said. “Nothing says energy security like eliminating your backup supply before your primary source works.”
Matthew explained that the country’s current supply gap makes it unrealistic to impose an import duty on fuel when local refining capacity remains inadequate. He accused the government of attempting to shield inefficiency in the name of market protection.
“Our $20 billion refinery can’t compete with imported fuel, so instead of fixing the issues, the government is kneecapping competition,” he added. “Other refineries around the world thrive without needing protectionist policies. What Nigeria needs is transparency, not tariffs.”
The policy analyst further dismissed claims that the new duty would make petrol cheaper, describing that argument as “the memo’s boldest lie.” According to his analysis, applying a 15 per cent tariff would add between N95 and N100 to every litre of fuel, and by the time logistics, storage, and marketing costs are added, the increase could reach as high as N140 to N165 per litre.
He warned that such a development would immediately push up transportation costs, food prices, and electricity expenses for businesses relying on diesel or petrol generators. “Food prices will soar, transport fares will climb, and small businesses will close. Yet the government calls this affordability,” he said.
A related report recently indicated that petrol prices had already crossed N1,000 per litre in several parts of the country following approval of the new tariff plan by President Bola Tinubu.
Matthew also accused the government of maintaining a “double standard” in its handling of the petroleum sector, alleging that some marketers currently sell fuel from the Dangote Refinery at N100 to N120 above the import parity price. He claimed that while the government portrays fuel importers as harmful to the economy, the same refinery allegedly imports blending components to sustain its operations.
“The government is saying one thing and doing another,” he said. “They talk about promoting local refining but still allow the importation of key inputs for blending. The issue is not imports — it is the absence of transparency and competition.”
Matthew concluded that the proposed fuel import tariff is an attempt to “legislate monopoly pricing under the guise of public interest.” He argued that a truly reform-minded policy would promote open competition, reduce inefficiencies, and create a transparent pricing system that benefits consumers rather than a few dominant players.
“If this policy passes,” he warned, “it won’t be reform — it will be a heist, and the government will have held the door open.”
Similarly, a major oil marketer who preferred not to be named because he was not authorised to speak on the matter, said the ordinary Nigerians would bear the cost once the 15 per cent duty takes effect.
“The masses would bear the brunt,” the dealer said. “Local refiners think the tariff is meant to protect them, but they don’t realise that they are only creating more revenue for the Federal Government. In the end, it is the people who will pay for it.”
With rising inflation, falling purchasing power, and unstable fuel prices, stakeholders have urged the Federal Government to reconsider the proposed tariff and instead focus on increasing local production capacity, stabilising the naira, and providing incentives that make refining operations more efficient and sustainable.
