Breaking News: A Price Hike Shakes Up Nigeria's Fuel Market
Petrol Prices Soar, Sparking Concerns
In a move that has sent shockwaves through Nigeria's energy sector, the Dangote Petroleum Refinery has announced a significant price increase for Premium Motor Spirit (PMS), or petrol, as it's commonly known. The new ex-depot (gantry) price stands at ₦875 per litre, a substantial jump from the previous ₦774. This decision is expected to have a ripple effect on petrol prices across the country, with industry analysts predicting retail prices to reach around ₦1,000 per litre in certain states.
But here's where it gets controversial: this price hike comes at a time when Nigeria is making strides in domestic refining, aiming to reduce its reliance on imported fuel. So, why the sudden increase?
Global Market Turbulence and Its Local Impact
Energy analysts attribute this shift to ongoing geopolitical tensions and supply concerns in major oil-producing regions. These factors have created volatility in international crude oil markets, which, in turn, influence downstream pricing dynamics. Despite Nigeria's growing domestic refining capacity, the country is still susceptible to global market fluctuations.
The Dangote Refinery, a major player in Nigeria's energy landscape, is located in Lekki, Lagos, and is one of the world's largest single-train refineries. While it has played a crucial role in reducing the nation's dependence on imported fuel, the refinery is not immune to the impact of global crude benchmarks, which are tied to geopolitical developments.
The Trickle-Down Effect on Nigeria's Economy
Nigeria's transport and logistics sectors, highly sensitive to fuel costs, are bracing for the impact of these rising petrol prices. Higher fuel costs often lead to increased transport fares, goods prices, and operational costs for businesses. This, in turn, can contribute to higher consumer prices in the short term, potentially affecting the country's economic growth and job creation efforts.
Analysts warn that if international crude prices continue to rise, further adjustments at both the gantry and pump levels could be on the horizon. This situation underscores the delicate balance policymakers must strike between energy security, currency stability, and economic cost pressures.
A Call for Diversification and Resilience
Observers argue that this development highlights the need for Nigeria to continue diversifying its energy sources, improving logistics efficiencies, and strategically managing fuel stocks. These measures are crucial to mitigate the impact of external shocks on domestic fuel prices and ensure a more stable energy landscape.
Credit Crunch: SMEs Struggle Despite Record Lending
In a separate development, Nigeria's small and medium-sized enterprises (SMEs) are facing a credit crunch, despite record lending by development finance institutions like the Bank of Industry (BOI). BOI reported disbursing ₦636 billion to over 7,000 businesses in 2025, its largest annual outlay ever. However, SME stakeholders paint a different picture, claiming that this record lending has not translated into broad access for the country's vast SME base.
Dr Femi Egbesola, National President of the Association of Small Business Owners of Nigeria (ASBON), highlighted that most small businesses are still locked out of affordable financing due to high interest rates, stricter lending conditions, and a declining risk appetite among commercial banks. He emphasized that borrowing costs and compliance requirements have made available funds inaccessible to many SMEs.
ASBON described this financing gap as structural, noting that Nigeria has over 40 million SMEs, many of which are nano and micro enterprises operating as kiosks, corner shops, or small workshops. Limited access to capital is already impacting business survival, with many SMEs operating below capacity, scaling down, or shutting down entirely. This poses significant risks to job creation and economic growth.
While BOI reported that ₦178 billion of its 2025 financing went to SMEs, a larger share, ₦375 billion, was allocated to large enterprises. This reflects a lender preference for borrowers with stronger financial capacity.
The financing imbalance has become a policy concern for the Bola Ahmed Tinubu administration, which has prioritized industrial expansion and enterprise development as part of its economic reform agenda. Dr Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), called for targeted, concessionary financing and credit guarantee schemes to ease borrowing conditions for SMEs. He urged the Central Bank of Nigeria (CBN) to improve policy transmission and moderate interest rates, warning that without addressing infrastructure and regulatory constraints, SMEs would remain financially excluded.
ECA's Initiative: Simplifying Trade for African SMEs
In a positive development for African businesses, the United Nations Economic Commission for Africa (ECA) has launched simplified step-by-step guides to help small and medium enterprises (SMEs) and other businesses participate more effectively in the African Continental Free Trade Area (AfCFTA).
The guides were developed in response to concerns from the African private sector, particularly SMEs, about the lack of accurate and easy-to-understand information on engaging in intra-African trade and benefiting from AfCFTA preferences. Speaking at a continental workshop, Melaku Desta, Acting Director of ECA's Regional Integration and Trade Division, emphasized the initiative's focus on simplifying bureaucratic steps involved in cross-border trade, including obtaining trade licenses, certificates of origin, and meeting product health and safety requirements in exporting and importing countries.
The workshop, held in February 2026 at the Trademark Hotel in Nairobi, Kenya, reviewed experiences from countries piloting the guides, gathered feedback from public and private sector stakeholders, and discussed capacity-building needs to support wider adoption. The guides are designed to be short, non-technical, and practical, serving as a foundation for digital Trade Information Portals that provide accurate and up-to-date trade information.
Currently, the step-by-step guides are being piloted in Ethiopia, Seychelles, Tanzania, Namibia, Sierra Leone, Cameroon, and Mauritania. Participants at the workshop shared lessons from these pilot countries and launched several national guides alongside their digital trade portals.
ECA's initiative aims to reduce information barriers, improve trade facilitation, and enable SMEs to fully benefit from AfCFTA opportunities, promoting inclusive intra-African trade.
And this is the part most people miss: these developments showcase the complex interplay of global markets, domestic policies, and the challenges faced by African SMEs. It's a reminder that while progress is being made, there's still a long road ahead to ensure a thriving business environment for all. What are your thoughts on these issues? Feel free to share your insights and opinions in the comments below!
