Kehinde Fajobi
Fuel consumption across Nigeria has drastically fallen, driven by the surge in petrol prices since the removal of subsidies, leaving around 10,000 oil marketers on the verge of shutting down, according to industry leaders.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) reported a striking decline in petrol usage, dropping from 60 million litres per day in May 2023 to just 4.5 million litres per day by August 2024—a 92 per cent decrease. This sharp reduction has caused shortages, with only 16 out of Nigeria’s 36 states receiving fuel from the Nigerian National Petroleum Company Limited (NNPC) in August.
Since President Bola Tinubu announced the end of the fuel subsidy in May 2023, petrol prices have increased by roughly 488 per cent, soaring from ₦175 to more than ₦1,000 per litre by October 2024. The rising costs have rippled through the economy, inflating transportation prices and driving up overall inflation, as many Nigerians face heightened economic strain. Increasingly, vehicle owners are abandoning their cars for public transport options.
The drop in consumption has significantly affected the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), which claims massive financial losses.
PETROAN National Public Relations Officer Dr. Joseph Obele revealed that around 10,000 members may be forced to close within weeks due to financial challenges.
“Three days ago, there was a meeting at the national headquarters of PETROAN,” Obele said.
“At the meeting, there was an indication that about 10,000 of our members would quit business in the next 45 days because their trading capital had been severely affected.”
He explained that the cost of a truckload of petrol has skyrocketed from ₦7 million to ₦47 million in the past 16 months, leading PETROAN to request a ₦100 billion grant from the President on October 21 to help prevent widespread closures.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) President, Abubakar Maigandi, also confirmed the drop in fuel consumption and the struggles of union members.
“There is a drop in consumption, and the price of a truckload is higher now. So, we have reduced the quantity of fuel we buy,” Maigandi said. “For instance, someone who bought 10 trucks before can only buy eight now. We haven’t been getting the right quantity, so we sell only the little quantities we get.”
Additionally, the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) expressed concern, noting that the oil marketers’ inability to afford products has led to job losses among truck drivers and petrol station employees, exacerbating the economic impact on the sector and its workforce.