Published on: 2026-04-14
EBC Financial Group (EBC) notes that, ever since the March price shock, Nigeria has shown tension that matters for inflation and foreign exchange (FX) confidence, with petrol cargoes leaving the country whilst households are still paying prices shaped by global costs. This is because petrol still starts with crude oil priced internationally in United States dollars (USD), then adds freight and insurance, then converts into Nigerian naira (NGN) through the official FX market, so a jump in crude or shipping costs can quickly feed into pump prices when USD liquidity is tight. Against that backdrop, the Dangote Petroleum Refinery exported 12 cargoes of Premium Motor Spirit (PMS), totalling 456,000 metric tonnes, after reaching full capacity in February 2026, whilst domestic petrol prices were reported to have jumped by about 65% in March 2026 despite higher local output.
The global input pressure behind that chain was clear in late March. Brent is a widely used reference price for crude oil, and the Brent spot price rose from USD109.14 per barrel on 25 March 2026 to USD121.88 per barrel on 30 March 2026 on daily spot readings, which raises the USD cost of crude for refineries and the USD cost of any imported fuel that still enters the market. Official consumer data also show prices were already edging higher before the reported March jump, with the National Bureau of Statistics (NBS) reporting an average retail petrol price of NGN 1,051.47 per litre in February 2026, up 1.62% from NGN 1,034.76 per litre in January 2026.
David Precious, Senior Market Analyst at EBC Financial Group, said, "Exports indicate capacity is improving, but the domestic fuel bill still starts with a global barrel paid for in USD. When Brent and freight rise together, the NGN pump price can move quickly if USD availability is tight in the official market."
The export shift is large enough to change how West African buyers source fuel during a shock. Vessel-tracking data cited in public reporting put Nigeria's clean petroleum product exports at about 214,000 barrels per day in March, up from an average of 100,000 barrels per day in February, with shipments to other African countries at about 90,000 barrels per day in March, up from 38,000 barrels per day in February. Those flows can sit alongside higher prices at home because they do not lower the international price of crude oil, and crude remains the main ingredient in petrol.
Shipping risk is also built into pump price because it affects both crude prices and the cost of moving fuel. The United States Energy Information Administration (EIA) estimates oil flows through the Strait of Hormuz averaged about 20 million barrels per day in 2024, which it describes as roughly 20% of global petroleum liquids consumption, and the International Energy Agency (IEA) describes the strait as carrying around 25% of the world's seaborne oil trade. When risk rises around a route of that scale, freight and insurance costs often rise alongside crude, and those same USD costs can later feed through into NGN pump prices.
Domestic supply and demand figures explain why global costs still matter even with a large refinery operating. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) February 2026 Factsheet reports average daily petrol consumption at 56.9 million litres per day in February, down from 60.2 million litres per day in January, and it reports the Dangote refinery supplied 36.5 million litres per day of petrol in February 2026 alongside 8.0 million litres per day of diesel. When supply does not consistently meet demand, the market remains exposed to USD-priced barrels and USD-priced logistics, especially when global crude and shipping markets move in tandem.
EBC notes that there are three checks that can show whether pressure is easing. The first is whether domestic supply remains close to consumption over several months, because persistent gaps tend to pull the market back towards USD-priced supply. The NMDPRA February Factsheet puts consumption at 56.9 million litres per day versus 60.2 million litres per day in January, and it puts Dangote petrol supply at 36.5 million litres per day in February 2026.
The second is the official retail price series, because it provides a consistent national reference for how quickly costs reach households. The latest published national average was NGN 1,051.47 per litre in February 2026 versus NGN 1,034.76 per litre in January 2026.
The third is whether USD flows through the official FX market become more predictable during periods of higher global crude prices, because fuel costs are typically USD costs before they become NGN prices. The Central Bank of Nigeria (CBN) circular dated 25 March 2026 states that International Oil Companies (IOCs) may repatriate 100% of export proceeds through Authorised Dealer Banks (ADBs), subject to documentation and monthly reporting requirements, following earlier restrictions linked to cash pooling arrangements. Clearer rules around USD flows can reduce uncertainty when global costs are converted into local fuel prices.
"The next test is whether Nigeria can keep supply steady at home when the global crude prices become volatile. Exports are progressing, but stability still depends on predictable supply and predictable USD access." Precious added.
For market participants tracking the same pricing chain, global crude benchmarks remain practical reference points used in physical trade. Brent Crude Spot (XBRUSD) and West Texas Intermediate Crude Spot (XTIUSD) are widely used crude oil reference prices. EBC oil commodities provide access to these benchmarks via Contracts for Difference (CFDs), which track price movements without physical delivery.
