Diesel prices increased by 28.69% within one year – NBS

Diesel prices rose by 28.69% between April 2022 and April 2023. This is according to data from the National Bureau of Statistics (NBS).

The Diesel Price Watch report states that Nigerians paid an average of N842.25 per liter for diesel in April 2023, a 28.69% increase from the N654.46 per liter paid in April 2022. Meanwhile, there was a 0.17% increase from the N840.81 per liter paid in March 2023.

Further details

In April 2023, the highest diesel costs were recorded in Adamawa at N980.33 per liter, Bauchi at N934.46 per liter and Borno at N900.50 per liter. The lowest diesel costs were recorded in Bayelsa at N708.04 per liter, Kebbi at N773.33 per liter and Anambra at N773.56 per liter.

The Northcentral zone recorded an average of N873.22 per liter, the Northwest recorded N828.97 per liter, the Northeast recorded N895.42 per liter, while the Southeast recorded N809.29, the Southwest recorded N830.57 per liter and the South-South recorded N807.59 per liter.

The Nigerian context

There are a number of factors that have made diesel more expensive in recent times. Some of them include logistics challenges, lack of refining capacity and inflationary trends.

According to analysts, continuous imports of the commodity due to a lack of refining capacity in the country will only make diesel more expensive because the pricing is exposed to the risks in the global market.

Marketers often encounter some fees and levies while transporting diesel to various towns and communities across the states in the federation, so, the prices will vary based on the amount spent in transporting diesel in the country.

Beyond that, Nigerian businesses are not solely reliant on power from the national grid due to power failures. So, high demand of diesel will lead to increased prices, as seen in the comparison between diesel prices in April 2022 and April 2023.

Stakeholder view

On the other hand, some industry stakeholders believe that the push for a switch to renewable energy, particularly solar systems for commercial and industrial entities will reduce diesel demand in the coming years.

This is because running costs for businesses using diesel on a daily basis are no longer sustainable in the long term. In December 2022, Rensource Chief Executive Officer, Prince Ojeabulu told Nairametrics:

• “It is no secret that businesses have been significantly affected by high fuel prices, especially diesel. We think businesses should not be on diesel in the first place because of its polluting nature and its vulnerability to price increases.”   

For the local refining factor, the Dangote refinery will be commissioned in a few days by President Muhammadu Buhari and the Dangote Group has said that at full capacity, the Dangote refinery can meet 100% of the Nigerian requirement of all refined products (inclusive of diesel) and also have surplus for exports.