Nigeria Faces Worsening Fuel Crisis Amid Import Challenges and Price Hikes

Fuel queues have lengthened in Nigeria due to supply issues at the Nigerian National Petroleum Corp. Challenges include importing constraints due to foreign currency shortages and a price cap, resulting in rising gasoline prices and adding to the country's inflation and cost of living issues.

Fuel queues lengthened across major Nigerian cities on Monday after state-oil company Nigerian National Petroleum Corp. faced problems supplying gasoline to local traders and depots.

Last year President Bola Tinubu's government opened up gasoline imports to private companies, but foreign currency shortages and a cap on the price of petrol mean that NNPC remains the only importer. Nigeria's new Dangote Refinery is yet to start processing gasoline. "The NNPC Ltd wishes to state that the tightness in fuel supply and distribution witnessed in some parts of Lagos and the Federal Capital is as a result of a hitch in the discharge operations of a couple of vessels," NNPC spokesperson Olufemi Soneye said in a statement over the weekend when queues began forming.

Gasoline prices at retail stations have risen to over 800 naira ($0.5063) from around 617 naira per litre in May 2023 when the government announced it was ending gasoline subsidies. The price surge has added to already high inflation in Nigeria and a cost of living crisis. The NNPC Ltd owes gasoline suppliers over $6 billion, thus affecting supplies, and is seeking to raise financing to settle the debts.

($1 = 1,580.0000 naira)