Fuel Prices are soaring: Is the war to blame?

You’ve either screamed in agony when you saw the fuel prices recently, or you have litres of fuel stored somewhere that can last you a lifetime. No other option.
Then, you must’ve screamed louder when you heard that the fuel price hike has something to do with the ongoing war with the Middle East.
You must’ve thought, ‘how war wey dey happen for Iran dey affect price of petrol in Oshodi?’
We’re here to explain why.

If you view our posts consistently (which you should, if you don’t), you would already know about the ongoing back and forth between Isreal and the US against Iran alongside their allies.
You might be thinking, ‘yes, I heard, how should that affect the price of kerosene in Aba market?’

Well, it affects it massively.

This is because there’s a narrow strip of water sitting between Iran and the Arabian Peninsula called the Strait of Hormuz. Every day, about one-fifth of the world’s entire oil supply passes through it.

You should know where we’re going with this. When there are unrests and instability around a major supply route, ‘fear of the unknown’ would drive prices up, and that is exactly what happened. As at the beginning of March, global crude oil price jumped from 78 dollars to 100 dollars per barrel.
Again, you must be thinking;
Nigeria produces a lot of crude oil, why should the ‘outside price’ affect our ‘inside price’ when we can just rely on our own resources?

Unfortunately, it affects it a lot, mainly for two reasons.
One, while Nigeria produces crude oil, we mostly import refined oil. Crude oil goes out, refined oil comes in. So, we’re not left out of the jump in price.
And two, even though Nigeria's inhouse Dangote Refinery is supposed to help buffer the increase; they also suspended petrol loading on the 2nd of March, and when they resumed, they tagged along with the increase in fuel price across fueling stations.

So far, NNPC has raised the fuel price to 1175 naira per litre, with fueling stations following suit and some even raising it to about 1400 naira per litre. And now, while complaining, fuel stations are already being filled with long queues as people fear even higher prices.

There appears to be no solution viable in sight, as the Petroleum Products Retail Outlet Owners
Association of Nigeria has warned that if the war continues, petrol could hit 2000 naira per litre.
While Dangote Refinery claims they can meet Nigeria’s full daily demand and maintain a daily supply if external supply diminishes or extinguishes, they do not promise affordability.

And remember, Nigerians are going to bear the full brunt of these hikes as the fuel subsidy has been removed since May 2023. This means cost of transportation, powering generators (since getting stable electricity in Nigeria is still far from being attainable), and ultimately, food, rent, day-to-day services would all spike, further increasing the cost of living for Nigerians.

Your secondary school Social Studies teachers really meant it when they said ‘the world is a global village’ because actions taking place continents away from us are taking effect on the daily lives of Nigerians.