Well over two years after President Bola Tinubu announced the withdrawal of subsidy on petrol, his government has again approved a 15% import tariff on the importation of the fuel and diesel in Nigeria in a bid to support local refining operations and reduce dependence on imported fuel.
According to official documents, the levy dated 21 October 2025 marks the first time Nigeria has imposed an import duty on petroleum products.
The measure is structured as an ad valorem charge based on the Cost, Insurance and Freight (CIF) value of fuel imports and follows a similar announcement in May by the government to introduce a 5% surcharge on petrol, diesel and Jet fuel beginning in 2026.
The new tariff policy is designed to close the price gap between imported and domestically refined products and to encourage further investment in local refining capacity.
The decision comes just days after Aliko Dangote, the chairman of the Dangote Group said the company will expand its refinery capacity from 650,000 b/d to 1.4m b/d by 2028.
President Bola Tinubu has endorsed the expansion, saying it will strengthen Nigeria’s industrial base and promote energy self-sufficiency.
Government sources indicated that the levy is expected to add no more than ₦100/litre to current pump prices.
Copies of the directive were sent to the Attorney General of the Federation, Lateef Fagbemi; the Executive Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji; and the Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed.
Nigeria’s fuel pricing model is based on import parity, incorporating logistics, insurance, freight and landing costs.
However, growing domestic refining capacity has intensified competition, with local producers accusing importers of undercutting prices through the sale of cheap, substandard fuel.
Since commencing operations in 2024, Dangote Refinery has lobbied for policies that create a level market. The company had previously filed a ₦100bn lawsuit against importers and the regulator over import licensing but later withdrew the case after an out-of-court settlement.
Proponents of the new tariff argued that the measure would strengthen the local value chain, stabilise prices and incentivise investment in refining and logistics.
Based on current CIF values, the 15% duty represents an increment of about ₦100/litre, keeping estimated Lagos pump prices around ₦964.72/litre — still below regional averages of $1.76 in Senegal, $1.52 in Côte d’Ivoire and $1.37 in Ghana.
Meanwhile, in an article published by Energy in Africa, Victor J Bassey, Managing Partner at Bavijas has argued that the measure makes little economic sense given the country’s peculiar situation.
“The new import levy introduces a government-imposed cost barrier that distorts competition and tilts the market further in its favour,” Bassey said.
“Importers face steeper costs, while domestic refiners like Dangote stand to gain from increased protection, raising questions about whether the market is truly operating on a level playing field.”
“If we truly desired deregulation as enshrined in the PIA, shouldn’t all players compete on equal terms?”
However, a 30-day transition period has been granted for importers to adjust cargoes already in transit.
The country’s fuel regulator NMDPRA and the Nigeria Customs Service (NCS) have been directed to implement and enforce the new levy once the window closes.
Nigeria still imports a significant share of its refined fuel despite recent increases in local capacity.
At least 60% of the country’s fuel demand is met with imports while the remaining balance is filled almost entirely by Dangote.
Although the Petroleum Industry Act (PIA) permits import duties on petroleum products, it cautions against market distortions or monopolistic practices that could harm consumers.
[…] announcement comes just days after President Bola Tinubu approved a 15% import tax on petrol and diesel—Nigeria’s most consumed fuels—in a move aimed at boosting local refining […]