Global oil prices rose more than five per cent on Wednesday, recovering from a drop the previous day, as Brent crude reached $92.43 per barrel and West Texas Intermediate climbed to $88.38 per barrel. The increase follows a decline to $88 per barrel on Tuesday, which itself came after prices had surged past $100 earlier in the week due to escalating conflict in the Middle East.
In a separate but related development, Nigeria’s Dangote Refinery announced a reduction in its petrol (PMS) price on Tuesday. The cost at the refinery gantry was cut by ₦100 to ₦1,075 per litre, while coastal distribution prices fell to ₦1,050 per litre. This marks the first price decrease after three consecutive hikes.
The refinery stated the adjustment reflects movements in global crude oil markets. In a statement, it explained that all crude is priced against international benchmarks plus a $3-$6 premium, with foreign exchange transactions conducted at prevailing market rates. It emphasised that no subsidies apply to either crude or forex, and that prices under the Naira-for-Crude arrangement are similarly benchmarked and converted using the current exchange rate.
The ongoing Middle East conflict, involving the United States, Iran, and Israel, has driven volatility in global oil markets. U.S. President Donald Trump said on Tuesday that military operations were progressing faster than initially planned and could conclude “very soon.”
Against this backdrop of international price fluctuations, Nigerian President Bola Tinubu directed the immediate deployment of approximately 100,000 Compressed Natural Gas (CNG) conversion kits nationwide. The initiative, announced by Ismaeel Ahmed, Executive Chairman of the Presidential Initiative on CNG (Pi-CNG), aims to help vehicle and tricycle owners switch from petrol to CNG. Deployment is expected to begin within two to three weeks, as part of broader efforts to mitigate the impact of rising fuel costs on transportation.
The simultaneous movements—a global oil price rebound coupled with a domestic refinery price cut—highlight the interconnectedness of international crude markets and local fuel pricing in Nigeria. While Dangote Refinery’s pricing mechanism ties directly to global benchmarks, the government’s CNG push represents a strategic pivot toward alternative energy sources to insulate the economy from future oil price shocks. The effectiveness of these measures will depend on the sustainability of lower global crude prices and the speed of CNG infrastructure rollout.
