Nigeria’s federal government says it will not intervene to regulate petrol prices despite growing volatility in global oil markets triggered by the escalating conflict in the Middle East.

Speaking during a TV interview on Wednesday, Finance Minister Wale Edun said the government would instead introduce measures to cushion the economic impact of the war involving the United States, Israel, and Iran.

Edun said President Bola Tinubu had already announced plans to provide an additional 100,000 Compressed Natural Gasconversion kits to help motorists switch from petrol to CNG, which costs about 25 to 30 percent of the price of petrol.

According to the minister, the government prefers market-driven solutions rather than direct price control.

“When there is market failure is where the regulator steps in. But in terms of balancing pricing, what we are looking to do is to manage the disruption and we don’t know how permanent or temporary it could be,” Edun said.

“But in the meantime, rather than reverting back and taking backward steps, we’ll look at every other measure that we have that can help the cost of living of Nigerians.”

The conflict in the Middle East has triggered sharp fluctuations in global energy markets, with crude oil prices briefly rising above $100 per barrel on March 9 their highest level since July 2022 before easing to about $87 the following day.

Earlier, the finance ministry warned that the conflict could affect Nigeria’s crude oil and gas prices, capital flows in financial markets, as well as global logistics and supply costs.

The surge in crude prices has also pushed up ex-gantry petrol prices, with many retail stations across Nigeria increasing pump prices. The development has led to higher transport fares on several major routes.

Edun said price adjustments by private sector operators reflect prevailing market conditions, citing developments at the Dangote Refinery.

The refinery recently reduced its ex-gantry petrol price to about ₦1,075 per litre after implementing three earlier increases, although retail pump prices remain elevated.

“Dangote reduced their price from, I think, around ₦1,200 to now just over ₦1,000 to ₦1,050, and that’s the dynamics of the market,” the minister said.

He added that Nigeria’s refining capacity is strengthening the country’s economic resilience, pointing to investments by Aliko Dangote, president of the Dangote Group.

“But I think we should be thankful at this time for the capacity we have in Nigeria to refine crude into petrochemicals and petroleum products,” Edun said.

He also noted that several countries lacking domestic refining capacity are facing greater economic disruption as energy prices rise.

Edun stressed that Nigeria must support local refiners to ensure a stable supply of petroleum products.

Meanwhile, the African Democratic Congress has urged the federal government to introduce a temporary cap on petrol prices to prevent further increases that could worsen the cost-of-living crisis. (Arise News)

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