Petrol price in Nigeria should be N750 — World Bank

The World Bank has stated that the Nigerian Federal Government may still be paying for fuel subsidy, considering that fuel prices are currently not cost-reflective in the country.

The international financial institution said the price of petrol should be around N750 per litre more than the N650 per litre currently being paid by Nigerians.

Its Lead Economist for Nigeria, Alex Sienaert, revealed this during his presentation of the Nigeria Development Update, December 2023 edition titled, ‘Turning The Corner (from reforms and renewed hope, to results) on Wednesday in Abuja. During the event, which is hybrid, he noted that based on the official exchange rate today, fuel should cost N750/litre.

He said, “It does seem like petrol prices are not fully adjusting to market conditions so that hints at the partial return of the subsidy, if we estimate what is the cost reflective of retail PMS price of the would-be and assuming that importation is done at the official FX rate.

“Of course, the liberalisation is happening with the parallel rates, which is the main supplier, the price would be even higher.

These are just estimates to give you a sense of what cost-reflective pricing most likely looks like. We think the price of petrol should be around N750 per litre more than the N650 per litre currently paid by Nigerians.”

He highlighted that the bank is recommending to the government to take additional measures with its bold reforms to secure the benefits from having taken those decisions.