Nigerians are growing anxious as the depot price of Premium Motor Spirit (PMS), commonly known as petrol, has surged to N889 per litre, a significant increase from last week's N887 per litre. This trend is particularly concerning as the price could potentially reach N1,000 per litre with the addition of a 15% tax, according to downstream operators. The highest price of N889 per litre was recorded by Matrix, while Aiteo offered the lowest price of N871 per litre. Other operators, such as Dangote Petroleum Refinery, Eterna, AA Rano, and AYM Ashafa, charged varying prices, with Dangote Petroleum Refinery at N877 per litre. The government's recent 15% fuel tax, set to take effect after a 30-day transition period ending on November 21, 2025, is a major factor in this price hike. Dr. Billy Gillis-Harry, the National President of the Petroleum Retail Outlets Owners Association of Nigeria (PETROAN), expressed support for the tax's implementation, emphasizing the need to protect businesses. The tax aims to strengthen national energy security, safeguard local refining capacity, stabilize the downstream market, and ensure fair and competitive pricing. The federal government justifies the tax by highlighting the threat of massive importation to domestic refining, which has been struggling with price instability due to misalignment between local refiners and marketers. The import parity often falls below the cost recovery point of local producers, especially during currency and freight fluctuations. The government's dual responsibility is to protect consumers and domestic producers from unfair pricing practices and collusion while maintaining a level playing field for domestic refiners to cover costs and attract investment. The proposed solution involves introducing an ad-valorem import duty of 1% (15%) on PMS and Diesel, applied to the Cost, Insurance, and Freight (CIF) value at discharge. This tariff is not revenue-driven but corrective, aiming to align import costs with domestic realities while maintaining affordability. The implementation will commence after a transition window, allowing importers to adjust cargoes and ensuring a smooth rollout without market disruption. President Tinubu has already approved the 15% ad-valorem import duty on PMS and diesel, directing the NMDPRA and the Nigeria Customs Service (NCS) to implement it after a 30-day transition period. The President also instructed the NMDPRA to issue regulations, prioritizing local production, and to periodically review the tariff rate and its necessity, considering the expansion of domestic PMS refining capacity under the oversight of the Implementation Committee on Crude Oil Refined Products Sales in Naira.
