Nigerian State Oil Company Rows Back Regulator’s Fuel-Price Hike

Nigeria’s state oil company ruled out higher gasoline prices this month, less than a day after the fuel regulator signaled the first increase since November, Bloomberg News reported. The reversal means that government-owned Nigerian National Petroleum Corp., the nation’s sole importer of gasoline, will continue to bear the cost of subsidizing fuel in Africa’s biggest economy. It’s the second time in as many weeks that policy makers have sent out contradictory signals, after the central bank on March 4 set aside plans announced by one of its officials to bar foreigners from some debt auctions. The Petroleum Products Pricing Regulatory Agency published an announcement late Thursday saying gasoline should retail for 209.6-212.6 naira ($0.51) a liter, almost 30% higher than current rates. On Friday, the NNPC insisted there would be no increase in March, reiterating a statement published at the start of the month. Based on the PPPRA data, the NNPC is making a loss of at least 47 naira a liter on the current retail price of 165 naira. Nigeria’s government has been trying since March 2020 to remove energy subsidies that cost about 744 billion naira ($1.8 billion) a year over the past 15 years, according to the Information Ministry. After prices were allowed to rise several times in the second half of 2020, they have remained steady since early December in the face of threatened labor-union protests, even though oil is trading about 40% higher at $69 per barrel. Read more.