To buffer pump prices against unstable crude oil costs and foreign exchange rates, the Federal Government plans to negotiate a ₦1,350-per-litre ceiling on the landing cost of petrol.
Speaking in Abuja on Thursday, Finance Minister Taiwo Oyedele outlined the initiative as part of broader efforts to stabilize fuel costs.
Although he cautioned that the measure will not eliminate household financial strain entirely, Oyedele stated that the price cap is designed to minimize sharp price spikes at the pump.
“We are introducing price modulation. Pump prices should not have to follow every swing in global crude or exchange rate. The government is negotiating a ceiling of N1,350 a litre on the ex-gantry cost of petrol to keep pump prices stable,” he said.
According to him, where the actual cost rises above the ceiling, refiners and importers would bear the shortfall and recover it later when crude prices or exchange rates become favourable, without breaching the ceiling.
“This is neither a subsidy nor a price control; it is designed to smooth prices over time, rather than suppressing them.”
He explained that the objective was to prevent sharp swings in pump prices, saying, “the reason is simple: N1,400 a litre today and tomorrow is better than N1,500 today and N1,300 tomorrow, because volatility itself adds to uncertainty and fuels go up sharply; they rarely come down as fast.”
Oyedele said the ceiling would be reviewed monthly, with adjustments made where necessary and the figures published for transparency.
He also announced a 30-day discount on petrol dispensed by NNPC Limited, with priority given to public transporters nationwide, while insisting that the measure was not a subsidy.
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