President Bola Tinubu has approved the introduction of a 15 per cent ad-valorem import duty on petrol and diesel imported into Nigeria, a policy designed to protect local refineries and stabilise the downstream oil market — though it may lead to a rise in pump prices.
The directive was contained in a letter dated October 21, 2025, addressed to the Federal Inland Revenue Service (FIRS) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and made public on October 30, 2025.
The document, signed by Tinubu’s Private Secretary, Damilotun Aderemi, conveyed the President’s approval of a proposal submitted by the FIRS Executive Chairman, Zacch Adedeji, who recommended the introduction of the tariff as part of a “market-responsive import tariff framework.”
The proposal outlined a 15 per cent duty on the cost, insurance, and freight (CIF) value of imported fuel to align import pricing with domestic production realities.
Adedeji, in his memo to the President, said the initiative aligns with the administration’s Renewed Hope Agenda for energy security and fiscal sustainability.
He stated, “The core objective of this initiative is to operationalise crude transactions in local currency, strengthen local refining capacity, and ensure a stable, affordable supply of petroleum products across Nigeria.”
The FIRS chief warned that the ongoing price instability in the downstream sector was partly caused by the “misalignment between locally refined products and import parity pricing.”
“While domestic refining of petrol has begun to increase and diesel sufficiency has been achieved, price instability persists, partly due to the misalignment between local refiners and marketers,” he wrote.
Adedeji further explained that the government’s responsibility was “twofold, to protect consumers and domestic producers from unfair pricing practices and collusion, while ensuring a level playing field for refiners to recover costs and attract investments.”
According to him, the new tariff would help prevent duty-free fuel imports from undercutting domestic producers and promote fair competition in the downstream sector.
Projections in the letter indicate that the 15 per cent duty could raise the landing cost of petrol by about ₦99.72 per litre.
“At current CIF levels, this represents an increment of approximately 99.72 per litre, which nudges imported landed costs toward local cost-recovery without choking supply or inflating consumer prices beyond sustainable thresholds. Even with this adjustment, estimated Lagos pump prices would remain in the range of N964.72 per litre ($0.62), still significantly below regional averages such as Senegal ($1.76 per litre), Cote d’Ivoire ($1.52 per litre), and Ghana ($1.37 per litre).”
The development comes amid Nigeria’s ongoing drive to reduce fuel imports and boost local refining capacity.
The 650,000-barrel-per-day Dangote Refinery in Lagos has started producing diesel and aviation fuel, while modular refineries in Edo, Rivers, and Imo states have begun small-scale petrol refining.
Despite these advances, imported petrol still accounts for about 67 per cent of the country’s total consumption.
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