The Nigerian National Petroleum Company (NNPC) Limited has agreed to forgo its petrol retail profit margin and sell fuel at cost for 30 days to cushion the impact of rising global oil prices on Nigerian households.
The decision, backed by President Bola Ahmed Tinubu, was announced by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, on Thursday, October 8, 2026.
Under the arrangement, NNPC Retail will sell petrol at the actual cost of supply, without adding its retail profit margin. For instance, if its landing cost is ₦1,300 per litre, it will sell at the same price.
Oyedele expressed hope that other fuel marketers would adopt similar measures, noting that the recent surge in crude oil and petrol prices was not expected to last long.
He, however, stressed that the initiative does not amount to a return of petrol subsidy, which the Tinubu administration removed on May 29, 2023.
The Federal Government is also negotiating a ₦1,350-per-litre ceiling on petrol landing or ex-gantry costs. Under the proposed arrangement, refiners and importers would absorb costs exceeding the ceiling and recover the difference later when market conditions improve.
Oyedele said the ceiling would be reviewed monthly to reflect changing costs, with figures published to promote transparency. He explained that the policy was designed to reduce sudden price fluctuations rather than impose permanent price controls.
The government also plans to introduce forward crude oil sales to domestic refineries to improve supply and shield petrol prices from international market volatility.
Other measures include increased cash transfers to vulnerable households, subsidised credit for small businesses and consumers, and efforts to eliminate unofficial road taxes and levies that contribute to higher transport fares and logistics costs.
The government is accelerating the deployment of Compressed Natural Gas (CNG) vehicles and infrastructure in collaboration with state governments. According to the announcement, CNG is 60 to 70 per cent cheaper than petrol, with transport operators expected to pass the savings on to passengers.
The Federal Government is also considering an excess-profit tax on businesses that exploit consumers through excessive pricing across the energy value chain. Proceeds would be used to fund transport support and vouchers for vulnerable urban minimum-wage earners.
It will also work with the National Assembly to consider additional tax relief for low-income earners under the 2027 Finance Bill, while reducing regulatory costs that contribute to higher prices of goods and services.
Another major initiative is the proposed National Strategic Fuel Reserve, which would allow the government to release refined petroleum products during global supply disruptions or artificial scarcity.
The government said the reserve would help discourage hoarding and market manipulation, strengthen energy security and moderate price volatility without reinstating subsidies or fixing pump prices.
Additional measures include improved traffic management in major cities to reduce fuel consumption and the use of NIPOST’s newly launched address codes to make logistics and deliveries more efficient.
The Presidency acknowledged the hardship Nigerians face because of high petrol prices but maintained that restoring a blanket subsidy would create greater long-term economic difficulties.
It argued that previous subsidy arrangements contributed to fuel scarcity, smuggling, currency pressures and fiscal challenges, insisting that targeted interventions would provide relief without reversing the reform.
The government also disclosed that it was developing a broader package of fiscal measures aimed at sustainably reducing inflation to single digits in the near term.
The announcement was contained in a statement issued by Bayo Onanuga, Special Adviser to the President on Information and Strategy, on October 8, 2026.
