The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said the Nigerian National Petroleum Company (NNPC) Limited’s decision to sell petrol at reduced prices by waiving its retail profit margin does not amount to a return of fuel subsidy.

Oyedele explained that the temporary discount, which took effect on October 1, 2026, would be funded entirely by NNPC Retail Limited through the reduction of its earnings per litre, without financial support from the Federal Government.

According to him, the initiative is designed to provide relief to households, commuters and transport operators facing high fuel costs. He said NNPC Retail could offset lower profit margins through increased sales and improved customer loyalty.

The minister stressed that the arrangement differs from the former fuel subsidy system, under which the government paid part of the cost of petrol to keep pump prices below market levels. He maintained that the subsidy regime ended in May 2023 and had not been reinstated.

Oyedele also disclosed that the Federal Government was considering a ceiling of N1,350 per litre on petrol’s ex-gantry or landing cost to moderate sharp increases in pump prices. Under the proposed arrangement, refiners and importers would initially absorb costs above the ceiling and recover the difference when market conditions improved.

He said the proposal was intended to moderate price fluctuations rather than introduce a subsidy or permanent price control. The proposed ceiling would be reviewed monthly, with relevant figures published to promote transparency.

Other measures being pursued by the government include expanding the use of compressed natural gas (CNG) for transportation, increasing cash transfers to vulnerable households, providing subsidised credit to small businesses and consumers, and addressing illegal road levies that increase transportation and logistics costs.

Oyedele said CNG was between 60 and 70 per cent cheaper than petrol, adding that wider adoption could help transport operators reduce expenses and potentially lower fares.

The government is also considering an excess-profit tax for energy-sector operators found to be taking undue advantage of consumers during periods of high prices. According to the minister, proceeds would be used to provide targeted transport support to vulnerable groups.

He further announced plans for forward sales of crude oil to domestic refineries, saying improved crude supply would help make local refining more predictable and reduce uncertainty in the domestic fuel market.

The Federal Government is also planning a National Strategic Fuel Reserve to improve supply security and respond to disruptions that could lead to scarcity or sharp price increases.

The Presidency said the NNPC discount had the backing of President Bola Tinubu and was part of efforts to protect households and commercial transport operators from rising global crude oil prices.

It urged other petroleum marketers to consider similar commercial measures to ease the burden on consumers.

The Presidency maintained that the government would not restore the general petrol subsidy, arguing that the current measures were intended to provide targeted relief while preserving reforms aimed at reducing pressure on public finances.

It added that the Federal Government was working on a broader package of fiscal measures to bring inflation down sustainably and ease the cost-of-living burden on Nigerians.

The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said the Nigerian National Petroleum Company (NNPC) Limited’s decision to sell petrol at reduced prices by waiving its retail profit margin does not amount to a return of fuel subsidy.

Oyedele explained that the temporary discount, which took effect on October 1, 2026, would be funded entirely by NNPC Retail Limited through the reduction of its earnings per litre, without financial support from the Federal Government.

According to him, the initiative is designed to provide relief to households, commuters and transport operators facing high fuel costs. He said NNPC Retail could offset lower profit margins through increased sales and improved customer loyalty.

The minister stressed that the arrangement differs from the former fuel subsidy system, under which the government paid part of the cost of petrol to keep pump prices below market levels. He maintained that the subsidy regime ended in May 2023 and had not been reinstated.

Oyedele also disclosed that the Federal Government was considering a ceiling of N1,350 per litre on petrol’s ex-gantry or landing cost to moderate sharp increases in pump prices. Under the proposed arrangement, refiners and importers would initially absorb costs above the ceiling and recover the difference when market conditions improved.

He said the proposal was intended to moderate price fluctuations rather than introduce a subsidy or permanent price control. The proposed ceiling would be reviewed monthly, with relevant figures published to promote transparency.

Other measures being pursued by the government include expanding the use of compressed natural gas (CNG) for transportation, increasing cash transfers to vulnerable households, providing subsidised credit to small businesses and consumers, and addressing illegal road levies that increase transportation and logistics costs.

Oyedele said CNG was between 60 and 70 per cent cheaper than petrol, adding that wider adoption could help transport operators reduce expenses and potentially lower fares.

The government is also considering an excess-profit tax for energy-sector operators found to be taking undue advantage of consumers during periods of high prices. According to the minister, proceeds would be used to provide targeted transport support to vulnerable groups.

He further announced plans for forward sales of crude oil to domestic refineries, saying improved crude supply would help make local refining more predictable and reduce uncertainty in the domestic fuel market.

The Federal Government is also planning a National Strategic Fuel Reserve to improve supply security and respond to disruptions that could lead to scarcity or sharp price increases.

The Presidency said the NNPC discount had the backing of President Bola Tinubu and was part of efforts to protect households and commercial transport operators from rising global crude oil prices.

It urged other petroleum marketers to consider similar commercial measures to ease the burden on consumers.

The Presidency maintained that the government would not restore the general petrol subsidy, arguing that the current measures were intended to provide targeted relief while preserving reforms aimed at reducing pressure on public finances.

It added that the Federal Government was working on a broader package of fiscal measures to bring inflation down sustainably and ease the cost-of-living burden on Nigerians.