• Reversal will trigger rise in forex, says Dr. Yusuf
• Policy is fiscal and market-stabilising instrument, says Prof Iledare

Experts and other stakeholders yesterday warned the country of jeopardisng long term national interests for short term measures. The experts, including economists, oil marketers, chambers of commerce and industry leaders, and other stakeholders, were reacting to the suspension of the of the implementation of the 15 per cent ad valorem import duty on imported Premium Motor Spirit and Diesel by the federal government.
Last week, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), in a statement posted on its X handle had informed the public of government’s suspension of the implementation of the tax.
“It should also be noted that the implementation of the 15 per cent ad-valorem import duty on imported Premium Motor Spirit and Diesel is no longer in view,” the Director, Public Affairs Department, NMDPRA, George Ene-Ita, said in the post.
“Nigeria must avoid short-term measures that jeopardise long-term national interests. The suspension of the 15 per cent import duty on petroleum products puts at risk energy security; industrialization; foreign exchange stability; job creation; backward integration and national economic sovereignty.
“Therefore, protecting domestic refining capacity is an urgent national imperative. Reinstating protective measures, supporting local refiners, ensuring policy predictability and regulating import volumes are essential steps toward securing Nigeria’s industrial future,” the Chief Executive Officer, Center for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, in a statement made available to TheTrustNews.com, yesterday.
For professor of petroleum economics, Prof. Wumi Iledare, the 15 per cent import duty should have been viewed as a fiscal and market-stabilising instrument, not a political gesture.
While some stakeholders see the development as a step in the right direction, yet, others argued that it is a disservice to local refinery, investment in the sector and by extension, a negative for the country’s overall economy.
For the Independent Petroleum Marketers Association of Nigeria (IPMAN), the suspension of the tax will affect sector and economy in both the short and long term.
“Well, if we view the suspension for the immediate gain, then we can say it is a good development; but for the future, it is not a good development. The reason is that provided that there is no tax or charges on the imports, our local refineries will not be patronised because their product will be a little bit costlier than imported products,” IPMAN President, Abubakar Maigandi, told TheTrustNews.com in a telephone chat at the weekend.
Yet another oil marketer who pleaded anonymity, agreed that government should go ahead with the implementation of the tax if only for the benefits it offers. These benefits our source listed to include reduced pressure on foreign exchange considering that importation of petroleum products is dollar denominated.
“The truth and reality is that government should implement that 15 per cent tax on petroleum products importation because it will help our economy. The reason why you see Naira now a little bit stable compared to before, is because of the reduction of purchasing outside. And if we want to encourage the Nigerian company, actually we have to, the government has to do that; they have to put that tax.
“This is a reality, but you know people don’t want to hear it, they put politics into it and is not good for our economy. The 15 per cent tax on fuel import will help the indigenous companies or refineries- all these refineries just coming up, people doing business; it will encourage them to do business, an foreign investors too will come into the sector with the needed investment,” the source, a high ranking stakeholder in the oil industry, said.
On fears that there could be fuel shortage as the yuletide approaches if the policy is implemented, the CPPE boss argued that while domestic refineries are expected to meet national demand within a short horizon, temporary supply gaps should be addressed not by dismantling protective measures but through guided, quota-based importation to supplement domestic output.
Yusuf noted that the suspension of the 15 per cent import duty on petrol and diesel carries profound implications for domestic refining, investment confidence, macroeconomic stability and the long-term competitiveness of the petroleum downstream sector.
He called for the reinstatement of the tax which he described as “essential to restoring competitive balance and safeguarding domestic refining investments.” According to him, the policy was aimed to serve as an industrial protection instrument designed to support emerging private refineries; promote backward integration and industrial development; ensure a level playing field for domestic producers; conserve scarce foreign exchange; protect jobs, stimulate local value addition; reduce exposure to global supply instability and encourage long-term investments in refining and petrochemicals
These objectives, laudable as they are, are now being threatened with the policy suspension. For instance, Dr. Yusuf noted that investors, including the Dangote Refinery and other modular refinery operators, made multi-billion-dollar commitments based on policy stability and the assurance of an environment that rewards local production. Therefore, he argued, suspending the duty undermines this protective framework and exposes domestic refiners to inequitable competition from importers benefiting from vastly superior international conditions.
According to the CPPE boss, local refiners operate within a high-cost environment shaped by expensive energy and self-generation; infrastructure gaps and logistics bottlenecks; high cost of capital; security-related risks and inefficiencies in ports and transport systems. These structural disadvantages, he argued, make parity with imported products impossible without protective measures.
He warned that reverting to heavy import dependence reopens vulnerabilities to global price volatility, geopolitical disruptions and supply insecurity- the same conditions that previously collapsed public refineries and created a fiscally ruinous subsidy regime.
Yusuf, an economist, equally agreed that petroleum importation is one of Nigeria’s largest consumers of foreign exchange. Consequently, he explained that increased imports of the product will heighten pressure on the naira; fuel inflation through exchange-rate pass-through; deepen balance-of-payments deficits and undermine macroeconomic stability.
This, he said will further come with loss of jobs and industrial value chains given that domestic refining stimulates broad value-chain activities in petrochemicals; plastics; logistics and transport; engineering services and fabrication and construction. Therefore, having an unrestrained importation effectively exports these jobs and opportunities to foreign economies.
The CPPE warned that frequent policy reversals weaken investor sentiment across the economy including refining and downstream operations; domestic manufacturing; financial institutions and global investment partners.
“Undermining confidence at this stage threatens the viability of transformational national assets such as the Dangote Refinery and modular refineries,” Dr. Yusuf said.
Justifying the need to protect indigenous firms, the CPPE boss explained that fair competition requires comparable operating conditions. He enumerated the challenges faced by Nigerian refiners to include infrastructure deficits; higher finance costs; insecure operating environments; elevated logistics costs and demurrage and weak transport and storage systems.
“Importers face none of these disadvantages. Without protective measures, domestic refiners operate at a structural disadvantage. The Dangote Refinery and emerging modular refineries are transformative national assets. Safeguarding them aligns squarely with Nigeria’s long-term economic and strategic goals,” the CPPE said.
He cited major economies that protects their strategic industries to include the United States which jealously guards her steel, agriculture, aviation, energy sectors; European Union which protects its manufacturing, agriculture, pharmaceuticals; India guards her refining and petrochemicals and China, which devised a comprehensive industrial policy to protect local capacity.
“Nigeria already maintains an Import Adjustment Tax List for strategic sectors such as agro allied, cement, sugar, steel, pharmaceuticals and automobiles. Therefore, extending similar protection to domestic refining is both logical and necessary,” Dr. Yusuf said.
He further argued that there exists a false dichotomy between domestic refining and price stability. “Strengthening refining capacity and moderating fuel prices are not mutually exclusive. With the right policy mix—including fiscal incentives, logistics support, transparent pricing and guided importation, Nigeria can achieve both goals simultaneously, because domestic refining, over the long term, reduces costs by limiting forex exposure, import-related logistics and premiums associated with global volatility,” Dr. Yusuf said.
In similar vein, the Ogun State Chamber of Commerce, Industry, Mines and Agriculture (OGUNCCIMA) also faulted the Federal Government’s decision to suspend the proposed implementation of the 15 per cent import duty on petrol and diesel imports. It insisted that the rescinding of the policy could slow down the nation’s progress toward energy independence and weaken investor confidence in the refining sector.
“The suspension of the 15 per cent fuel import tariff is disappointing. The policy was a step in the right direction to promote local refining, reduce dependence on imports, conserve foreign exchange and create a fair competitive environment for domestic producers. Its reversal sends a wrong signal to investors who have shown confidence in Nigeria’s energy sector,” OGUNCCIMA’s President, Niyi Oshiyemi, said.
A professor of petroleum economics, Prof. Wumi Iledare, argued that the 15 per cent import duty should have been viewed as a fiscal and market-stabilising instrument, not a political gesture.
“The intent is clear — to protect emerging local refineries, encourage domestic value addition, and gradually align Nigeria’s downstream market with its growing industrial capacity. In economic terms, this policy aimed to reduce import dependence, conserve foreign exchange, and support refinery viability. Domestic producers like Dangote Refinery and the rehabilitated NNPC plants need a short breathing space to stabilise operations and recover heavy capital investments. Many countries have used such temporary tariffs to nurture new industries.
“Of course, prices may rise slightly in the short term — but that’s part of the transition toward long-term efficiency where Nigeria meets its own fuel needs competitively. Let’s keep things in perspective: petrol here sells around N890–N965 per litre, while in Benin N1,800–N1,875, Togo N1,835, Ghana N1,550–N1,995, and Senegal N2,538. Nigeria still remains the lowest-priced market in the sub-region. The task now is ensuring border vigilance and market discipline to prevent arbitrage,” he contended.