The recent hike in petrol prices has sent shockwaves throughout Nigeria’s economy, with several business organizations, including the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), Lagos Chamber of Commerce and Industry (LCCI), and the Nigerian Employers Consultative Association (NECA), raising concerns over its impact on jobs, businesses, and consumers. The price increase, which saw petrol rise from N710 to N960 per litre at private depots, has exacerbated the challenges faced by many Nigerians, with independent petroleum marketers forced to sell the product above N1,000 per litre.
Price Hike and Its Impact on Businesses
According to reports, private depot owners in Lagos and surrounding areas increased the depot price of petrol by 35.2%, while major oil marketers and NNPC Ltd. have been selling the product at a lower rate of N895 per litre. Independent marketers, however, who source from private depots, have been pushed to charge higher prices, passing the burden onto consumers. The high price has led to instability in supply, with long queues persisting at petrol stations across Lagos, Abuja, and other major cities.
The Lagos Chamber of Commerce and Industry (LCCI) and the Association of Small Business Owners of Nigeria (ASBON) have expressed fears that this price surge will hurt small and medium-sized enterprises (SMEs). Businesses already struggling with rising operational costs will now face increased expenses in transportation, power generation, and logistics, potentially leading to shutdowns and job losses. LCCI’s Director-General, Dr. Chinyere Almona, warned that the removal of the fuel subsidy without adequate infrastructure in place would lead to inflation, reduced consumer purchasing power, and increased unemployment. The LCCI advocates for a long-term strategy that focuses on refining crude oil locally to stabilize fuel prices and boost the economy.
Impact on Nigerians and Workers
The Nigerian Employers Consultative Association (NECA) echoed similar sentiments, noting that the hike in petrol prices will increase the cost of living for millions of Nigerians and further impoverish workers. With higher transportation costs, commuters are already feeling the effects of the price increase, as fare hikes have been reported across the country. Many Nigerians, who are dependent on petrol for daily transportation and electricity, now face increased living expenses. NECA Director-General, Wale-Smatt Oyerinde, called on the government to take swift action to alleviate the financial strain on Nigerians.
The Trade Union Congress (TUC) also expressed its dismay, warning that the fuel hike will exacerbate the poverty levels among workers. They noted that while minimum wage adjustments may help, the increase in petrol prices could erode any potential benefits workers might receive.
NACCIMA’s Call for Constructive Dialogue
In response to the price increase, NACCIMA President, Dele Kelvin Oye, urged the government to engage in constructive dialogue with key stakeholders, including the private sector and labor unions. Oye stressed the importance of transparency in government policies and called for a detailed explanation of the factors driving the price hike, particularly given the government’s recent commitments during minimum wage negotiations. He also raised concerns about NNPC’s financial obligations and profitability, urging for more accountability within the national oil company.
Oye pointed out that fuel prices are subject to fluctuations in global oil markets and exchange rates but emphasized that any sudden price increases should be clearly communicated and justified to the public. NACCIMA remains committed to working with the government to find sustainable solutions that benefit both businesses and consumers.
Supply Challenges and Black Market Exploitation
Despite the price hike, many petrol stations are still grappling with supply shortages. In Lagos and Abuja, long queues persist at stations, while some have been forced to shut due to inadequate supplies. The scarcity has led to black market operators exploiting the situation, selling petrol in jerry cans at exorbitant prices ranging from N1,200 to N1,500 per litre.
Motorists have also voiced their frustrations. Audu Yahaya, a motorist in Nyanya, a suburb of Abuja, noted that despite the price increase, buying from NNPC stations remains cheaper but involves enduring long wait times. Many transporters have also passed the increased cost of fuel onto commuters, further straining the financial situations of everyday Nigerians.
Worsening Poverty Levels
ActionAid Nigeria condemned the hike, stating that it has plunged millions of Nigerians deeper into poverty. The organization’s Country Director, Andrew Mamedu, criticized the government for its lack of transparency in fuel pricing and called for a clear breakdown of costs and revenues associated with fuel imports, refining, and distribution. He noted that fuel prices in Nigeria are heavily influenced by exchange rate fluctuations, as the country imports the bulk of its fuel. As the naira continues to depreciate against the dollar, Nigerians are paying more at the pump, worsening inflation and deepening economic woes.
ActionAid also urged the government to prioritize investments in local refineries to reduce reliance on imports and stabilize fuel prices. They further called for the establishment of an independent committee to monitor fuel pricing, which should include civil society representatives to ensure accountability.
Conclusion
The recent petrol price hike in Nigeria has had a ripple effect across the economy, affecting businesses, workers, and consumers alike. With rising costs of living and operational expenses, many businesses, particularly SMEs, are at risk of closure, while Nigerians are grappling with increased transportation and fuel costs. NACCIMA, LCCI, NECA, and other business groups have called on the government to take immediate action, engage in dialogue with stakeholders, and implement long-term solutions to stabilize fuel prices and protect the livelihoods of Nigerians.
As the country navigates this challenging period, the need for transparency, accountability, and sustainable economic reforms has become more critical than ever.
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Source : Vanguard