World Bank Clarifies Petrol Import Comments In NDU Report

The World Bank Group has clarified its position on petrol importation in Nigeria, stressing that any move toward a liberalised Premium Motor Spirit (PMS) market must be carefully sequenced to safeguard energy security and protect consumers.

World Bank in its April 2026 Nigeria Development Update (NDU), released on April 7, which has now been removed from its website, had recommended allowing PMS imports as part of broader reforms in the downstream oil sector.

In a clarification, the Bretton Woods institution emphasised that while a competitive retail fuel market remains a desirable long-term policy direction, the transition must be gradual and well-structured to avoid unintended disruptions.

“Over time, transitioning toward a competitive retail market for Premium Motor Spirit is an important policy direction that requires a well-sequenced implementation strategy that guarantees the quality and standards of all petroleum products,” the bank stated.

The global lender pointed to prevailing uncertainties in international energy markets, noting that countries are increasingly prioritising supply stability, a reality it said Nigeria must also contend with in shaping its policy direction.

In the near term, the bank advised authorities to focus on ensuring steady fuel availability while cushioning the impact of reforms on vulnerable groups through targeted social interventions.

“In the case of Nigeria, the focus should be to provide targeted support to the most vulnerable people through their well-functioning social safety net system, and the World Bank Group stands ready to step up its existing support,” it added.

The institution also acknowledged ongoing efforts by the federal government and private sector operators to stabilise fuel supply, describing such measures as critical to protecting both households and businesses from volatility in the energy market.

“The World Bank Group recognises the efforts of the Government of Nigeria and the Nigerian private sector in taking concrete steps to safeguard fuel supply, a foundation that is essential to protect consumers and businesses,” it said.

In the April NDU report, the bank highlighted emerging pricing distortions in the domestic fuel market, noting that imported petrol currently appears cheaper than locally refined products supplied by the Dangote Petroleum Refinery.

According to the report, the refinery, now the dominant supplier following the halt in import licences earlier in 2026, raised its ex-depot price to about N1,275 per litre as of March 23, compared to an estimated import-parity price of N1,122 per litre, reflecting a cost gap of roughly 12 per cent.

The World Bank further warned that rising crude oil prices, driven by geopolitical tensions in the Middle East, could exacerbate inflationary pressures in Nigeria’s already fragile economy.

“An increase in oil prices to about $80 per barrel would directly add around 3.1 percentage points to headline inflation under a full pass-through assumption,” the bank noted, adding that higher fuel and electricity costs would ripple through transportation and logistics, with broader implications for prices across the economy.