The persistent drop in global oil prices has led to a significant decrease in the landing cost of premium motor spirit, which now stands at N774.82 per litre. This reduction is expected to trigger a further decrease in fuel prices in Nigeria.

Global Oil Price Drop

The global oil prices have been on a downward trend, with Brent Crude currently at $70 and US WTI at $66.70. This drop in global oil prices has resulted in a decrease in the landing cost of fuel in Nigeria.

Landing Cost Reduction

The landing cost of premium motor spirit has dropped from N927.48 per litre on February 21, 2025, to N774.82 per litre. This reduction is expected to intensify the price war in the downstream oil sector, with major oil marketers likely to offer lower prices.

Potential Petrol Price Drop

As a result of the reduced landing cost, petrol prices may fall to around N800 per litre, down from the current lowest retail prices of N860 and N880 per litre in Lagos and Abuja. The Independent Petroleum Marketers Association of Nigeria’s spokesperson, Chinedu Ukadike, confirms that a further reduction in crude oil prices would warrant a drop in petrol prices.

Ex-Depot Price Comparison

The landing cost is now lower than the ex-depot price of Dangote Refinery’s fuel, which is N825 per litre. This comparison highlights the potential for further price reductions in the downstream oil sector.

Price War Intensification

The reduction in landing cost is expected to intensify the price war in the downstream oil sector, with major oil marketers likely to offer lower prices. This price war will benefit consumers, who can expect to pay lower prices for fuel.

Conclusion

The drop in global oil prices has resulted in a significant decrease in the landing cost of premium motor spirit. This reduction is expected to trigger a further decrease in fuel prices in Nigeria, with petrol prices potentially falling to around N800 per litre. As the price war in the downstream oil sector intensifies, consumers can expect to benefit from lower fuel prices.