The head of Nigeria’s state oil company has told citizens that an ongoing “price war” in the energy sector is a sign of a healthy market that will ultimately lower costs for the public.
Bayo Ojulari, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), described the current market volatility as a “natural consequence” of Nigeria’s historic shift from a total reliance on imported fuel to domestic refining.
His comments come as petrol prices in Africa’s most populous nation have seen a dramatic decline, falling from over N1,200 ($0.75) per litre in late 2024 to as low as N739 at some pumps this month.
“Where there is healthy competition, the buyers are the ultimate beneficiaries,” Mr Ojulari told reporters in Lagos. “The market will stabilise, but we are going through a major transition.”
The ‘Dangote Effect’
The catalyst for this shift is the Dangote Refinery, a massive 650,000-barrel-per-day facility that began production in late 2024. Its entry into the market ended the decades-long monopoly held by the state over fuel imports.
In December 2025 alone, the competition reached a fever pitch:
- Dangote Refinery slashed its wholesale prices to N699 per litre.
- NNPC retail outlets responded by dropping prices to between N825 and N840.
- Independent marketers have been forced to follow suit, with some offering fuel at N739 per litre to maintain customer loyalty.
This represents a significant reversal for Nigerians, who faced skyrocketing costs and inflation exceeding 30% after President Bola Tinubu removed long-standing fuel subsidies in May 2023.
From regulator to competitor
Mr Ojulari was keen to clarify that under the Petroleum Industry Act (PIA), the NNPCL is no longer a government regulator but a commercial entity.
“We as NNPC are not regulators,” he explained, noting that the company now operates like any other private business and no longer receives government allocations. “The PIA divided the roles of regulation from the business. Our focus now is to compete profitably.”
While the price drop is a relief for consumers, it has created a “willing buyer, willing seller” tension for smaller marketers who purchased stock at higher prices and are now facing significant losses to stay competitive.
Production on the rise
Beyond the petrol pumps, Mr Ojulari briefed President Tinubu on broader gains in Nigeria’s energy sector. Oil production has reportedly risen to 1.7 million barrels per day (bpd), up from 1.5 million last year, with a target of 2 million bpd by 2027.
He also confirmed a major milestone in the Ajaokuta-Kaduna-Kano (AKK) gas pipeline. The “main line” welding is now complete, including a technically challenging crossing of the River Niger. Once commissioned in early 2026, the 614km pipeline is expected to provide a massive boost to industrialisation and power generation in northern Nigeria.
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