Petrol Price Surge in Nigeria: MRS Oil Raises Pump Prices Amid Global Tension

MRS

MRS Oil Nigeria Plc, a major distributor of products from Dangote Refinery, announced a notable increase in the pump price of Premium Motor Spirit (PMS), commonly known as petrol. Effective June 21, 2025, this adjustment raises the price in Lagos from ₦885 to ₦925 per litre. The company confirmed the new pricing through its official social media channels, urging customers to check updated rates across its stations nationwide.

Pricing Structure Across Nigeria

Under the new pricing scheme, MRS Oil set petrol rates as follows:

  • ₦925 per litre in Lagos

  • ₦955 per litre across Southeast and Northeast regions

  • ₦935 per litre for Ogun, Oyo, Ondo, Osun, and Ekiti States

  • ₦945 per litre in the Northwest and North‑Central zones

This move follows Dangote Refinery’s decision to raise its ex-depot price—the amount marketers pay before adding distribution costs—from ₦825 to ₦880 per litre on Friday, June 20. Distributors then adjust pump prices based on this new base rate plus logistics and operating margins.

What’s Fueling the Increase?

Industry analysts point to escalating geopolitical conflict in the Middle East as the primary driver. Tensions between Israel and Iran have intensified since mid-June, sparking concerns about disruptions to oil production and supply chains.

Since June 13, military exchanges unfolded: Israel struck Iranian military and nuclear assets, prompting playback responses involving drones and missiles toward Israel. Oil markets reacted swiftly. Over the week, both West Texas Intermediate (WTI) and Brent crude oil hit their highest levels since January, climbing nearly 3%.

The situation further escalated on the morning of June 22, when U.S. forces conducted targeted airstrikes on Iran’s key nuclear sites at Fordow, Natanz, and Isfahan. U.S. leadership described the strikes as successful, noting that they were launched after diplomatic efforts failed—confirming fears of prolonged regional conflict. Analysts warn that persistent tensions may continue pushing crude prices higher, potentially leading to more expensive pump prices globally.

Fuel Pricing History: A Lesson in Volatility

Nigeria’s petrol price has seen significant volatility in recent months. Just one month ago, Dangote Refinery reduced petrol prices to ₦875 per litre in Lagos and ₦905 elsewhere, following earlier hikes—₦890 in Lagos and ₦920 in the North‑East and South‑South zones—triggered by rising global oil rates.

With Dangote’s 650,000 barrels-per-day capacity, it’s Africa’s largest refinery. It’s intended to stabilize domestic fuel supply, reduce reliance on imports, ease foreign exchange pressure, and eventually cut costs for consumers.

Despite these benefits, pump prices remain vulnerable to global oil market shifts. When crude prices surge due to conflicts, refiners pass the increased costs to marketers, who then reflect those changes at the pump. MRS Oil’s recent price hike illustrates how global geopolitics directly translate into domestic pain for consumers.

Impacts on Nigerians and the Economy

The ₦40-per-litre hike in Lagos translates to immediate financial pressure on commuters and businesses. Here’s what to expect:

  1. Individual Drivers
    Average daily fuel use by commuters ranges from 10 to 20 litres. At ₦40 extra per litre, those using 15 litres daily will spend ₦600 more each day—over ₦18,000 monthly—on fuel alone. This squeeze tightens household budgets.

  2. Transporters and SMEs
    Taxi operators, delivery services, and small business owners face higher costs. Reportedly, commercial transporters may transfer the added ₦600+ daily expense to passengers or customers, increasing prices for essential services and goods.

  3. General Inflationary Effect
    Nigeria’s inflation rate in May hovered around 28%, propelled mainly by food and transportation. Rising fuel costs—an input for nearly every sector—could push inflation above 30%. This makes everyday life even more expensive.

  4. Economic Outlook
    Given fuel’s role as a cost benchmark, persistent price hikes can suppress consumer spending. Businesses facing higher input costs may slow hiring, investment, and growth, hampering economic expansion.

Dangote Refinery: A Structural Shift in Nigeria’s Fuel Landscape

Since launching in late 2023, Dangote Refinery has processed over 150 billion barrels of crude—substantially curbing imported fuel dependence. Industry observers expected the domestic facility to generate sustained price stability. However, imported-indexed pricing and global disruptions still ripple through Nigeria’s own market.

Dangote’s continued investment in expanding refinery capacity and streamlining supply chains aims to deliver long-term cost savings. Meanwhile, analysts anticipate competition among local distributors to improve efficiency and margins to pass savings to consumers.

What Lies Ahead?

Nigeria’s fuel market watchers and consumers should monitor several key factors:

  • Crude Oil Price Trends
    Persistent Middle East conflict may keep crude prices elevated, affecting future pump pricing.

  • Dangote’s Pricing Strategy
    Refinery executives occasionally absorb small price shifts, delaying or softening pump price changes. Any such move could momentarily relieve consumers.

  • Market Competition
    Competitive pressures among marketers—serving both urban and rural populations—could encourage price moderation, especially where demand elasticity is high.

  • Government Interventions
    The Nigerian government could offer subsidies or regulatory relief if prices reach politically or socially unacceptable levels. Delays in central bank foreign exchange policies may also ripple into import costs.

  • Subsidy Reform Dialogue
    The government occasionally explores fuel subsidy removal. Transparency in fuel pricing could support non-distortionary reforms designed to channel savings into infrastructure, social welfare, or poverty reduction.

Bottom Line

  • MRS Oil raised Nigeria’s petrol pump price from ₦885 to ₦925 per litre in Lagos on June 21, 2025, citing market updates.

  • Regional pricing ranges now span ₦935 to ₦955 in various parts of the country.

  • Dangote Refinery’s ex-depot price rose to ₦880, forming the new base for marketers.

  • Middle East geopolitical flare-up between Israel, Iran, and later U.S. involvement triggered a crude oil price jump (~3%), influencing domestic prices.

  • Nigerians brace for higher living costs, stretched incomes, and amplified inflation as fuel price cascades affect everything from transport to grocery bills.

  • Refined stability may appear in the long run, given Dangote’s capacity and potential market competition; but for now, consumers feel the tightening pinch.

A Call for Informed Planning

Consumers can track MRS Oil’s in-station postings or state fuel boards for updated price lists. Meanwhile, businesses may need to adjust budgets or pricing to accommodate rising transport costs.

For policymakers, the challenge lies in balancing short-term relief with long-term structural reform. Subsidy reforms, refined competitive dynamics, and increased transparency could insulate consumers from frequent spikes and promote market-based pricing.

Final Thoughts

MRS Oil’s latest price increase reflects a direct response to global market turbulence. While Dangote Refinery sets the foundation for long-term stability, the immediate impact underscores oil markets’ sensitivity to geopolitical events. As Nigerians navigate this environment, smart budgeting, transparent policymaking, and market reforms remain critical.

Share

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending Posts