The Petroleum Products Pricing Regulatory Agency (PPPRA), which regulates the Nigerian downstream sector, has removed the cap on fuel prices, instituting a “market-based pricing regime” for petroleum products. The agency will continue to monitor trends in the oil market and advise the Nigerian National Petroleum Corporation (NNPC) and marketers on guiding price for fuel. The new rules give marketers the freedom to set the price of the fuel and sell above the price given by the agency.
In March 2020, the Petroleum Products Pricing Regulatory Agency (PPPRA) introduced a “modulation mechanism” to allow fuel prices fluctuations following the international crude oil market. In addition, the government lowered the price of gasoline by 14%, from NGN145/l (US$39c/l) to NGN125/l (US$34c/l). In 2016, the government announced the end of fuel subsidies and partially liberalised the downstream industry, relaxing the price-fixing mechanism for petroleum products, allowing the entry of new players and deregulating importation procedures. However, the PPPRA sets the price of fuels. Since then, the country de facto restored fuel subsidies by allowing the NNPC to deduct as part of its operational cost the excess cost above the price ceiling.