The Business NG - BusinessNg

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Despite being Africa’s largest crude oil producer and home to the continent’s biggest refinery, Nigeria continues to import refined petroleum products, a reality that has contributed to rising petrol prices even as the dollar weakens. On Wednesday, BusinessNg notes that retail petrol prices in major cities like Lagos and Abuja hit N835 and N839 per litre, respectively, reflecting persistent domestic supply constraints. Meanwhile, crude oil prices on the international market continue to climb, and the naira has shown relative strength against the dollar. Economists say the situation exposes a structural anomaly in Nigeria’s energy sector. While standard economic theory suggests that rising crude prices coupled with a stronger currency should ease domestic fuel costs, operational inefficiencies at local refineries, under-capacity production, and dependence on imports continue to push prices higher. “This is a paradox that wouldn’t make sense in conventional economic textbooks,” noted an energy analyst. “Nigeria produces vast amounts of crude and has refining capacity, yet it imports fuel. The system’s inefficiencies override market fundamentals.”