Retailers Urge FG to Resume Petrol Imports to Boost Competition

Nigeria’s petroleum products retail outlets association has called on the Federal Government to reinstate fuel import licenses, arguing that opening the market to multiple suppliers represents the most effective mechanism for promoting competition and stabilizing fuel prices across the country.

The Petroleum Products Retail Outlets Owners Association of Nigeria cited recent World Bank recommendations supporting import liberalization as validation of its long-standing advocacy for a competitive and liberalized downstream petroleum market. The retail sector association contends that restricted competition and constrained supply have directly contributed to elevated fuel prices currently exceeding import-parity levels.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority suspended fuel importation last month, citing improved domestic refining capacity as justification for closing the market to imported petroleum products. However, PETROAN argues that restricting imports concentrates supply power in the hands of limited domestic suppliers and removes competitive pressure that would otherwise constrain fuel prices.

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The National President of PETROAN, Billy Gillis-Harry, stated that competition represents the most effective tool for stabilizing fuel prices and ensuring long-term energy security. He criticized the current situation, noting that the elevated fuel prices currently afflicting Nigerian consumers would not have occurred if government-owned refineries operated at full functionality or had been properly privatized to encourage competitive operations.

“The recent outrageous price of petroleum products would not have occurred if government-owned refineries were fully functional or properly privatised,” Gillis-Harry stated.

The association emphasized that reintroducing petrol import licenses would promote supply diversification, prevent monopolistic market concentration, and protect consumers from exploitative pricing practices that flourish in markets with limited suppliers.

PETROAN drew parallels with Nigeria’s telecommunications sector reform, noting that market entry by competitors including MTN and Airtel substantially improved service quality and reduced costs for consumers. The association contends that similar competitive dynamics would benefit the petroleum sector if import restrictions were removed and government refineries privatized.

The World Bank highlighted in its recent Nigeria Development Update that restricted competition and supply constraints in the downstream sector have contributed to rising fuel prices. The institution warned that sustained supply rigidity combined with rising global crude oil prices could substantially worsen inflationary pressures across the broader Nigerian economy.

PETROAN acknowledged significant investments such as the Dangote refinery while emphasizing that healthy competition represents enhancement rather than threat to local refining capacity. The association argues that competition provides mechanisms to stabilize market prices while domestic refining capacity expands and becomes more efficient.

The association recommended a comprehensive approach to downstream sector reform including immediate reinstatement of petrol import licenses to encourage multiple supply sources and deepen competition, full privatization or commercial restructuring of government-owned refineries to ensure efficiency and optimal performance, commencement of production activities at the Port Harcourt refinery to increase domestic supply, and creation of a fully deregulated and competitive market environment.

PETROAN called on the Federal Government, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, and the Nigerian National Petroleum Company Limited to implement policies encouraging open market participation and establishing a level playing field for operators.

The retail association stated, “In light of the foregoing, PETROAN makes the following recommendations to the Federal Government, NMDPRA and the Nigerian National Petroleum Company Limited: immediate reinstatement of petrol import licences to encourage multiple supply sources, deepen competition, and stabilise pump prices; full privatisation or commercial restructuring of government-owned refineries to ensure efficiency, transparency, and optimal performance; and commencement of production activities at the Port Harcourt refinery.”

PETROAN’s position reflects broader debate within Nigeria’s downstream petroleum sector about optimal policy approaches to fuel pricing and supply reliability. Market advocates argue that competition drives efficiency and affordability, while energy security proponents worry that import dependence could compromise national interests if global markets face disruption.

The association emphasized its commitment to working collaboratively with government and regulatory institutions to build a resilient and competitive petroleum distribution system that simultaneously supports economic stability and national development objectives.

PETROAN’s call for import liberalization resonates with other downstream stakeholders including independent petroleum marketers who argue that restricted imports undermine the deregulation mandate of the Petroleum Industry Act. The position diverges from energy experts who warn that overreliance on imports at this critical moment in Nigeria’s refining sector development could undermine investor confidence in domestic refining projects and slow the nation’s transition toward energy self-sufficiency.

The debate illustrates competing visions for Nigeria’s petroleum sector future. Market competition advocates emphasize that open borders and multiple suppliers generate optimal pricing and efficiency. Energy security proponents stress that protecting and nurturing emerging domestic refining capacity represents a strategic priority that should temporarily outweigh pure competition considerations.

The Federal Government continues facing pressure from multiple stakeholder groups advocating conflicting approaches to fuel importation policy. The resolution of this debate will substantially influence Nigeria’s petroleum sector development trajectory over coming years and determine whether the nation moves toward greater energy independence or maintains substantial import dependence.