Reported By Mary Udezue | Edited by: Gabriel Osa
CBN Warns Petrol Prices Could Reach Around ₦950 per Litre in 2026 Amid Economic Forecast
ABUJA, NIGERIA — The Central Bank of Nigeria (CBN) has projected that the price of Premium Motor Spirit (PMS), commonly known as petrol, could average about ₦950 per litre in 2026, according to its 2026 Macroeconomic Outlook, a forecast that has stirred debate over future energy costs in the country. The projection is rooted in key assumptions about global oil markets, exchange rates, and domestic crude production.
In outlining its outlook, the apex bank based the petrol price estimate on an average crude oil price of around $55 per barrel in 2026 and an assumed exchange rate of roughly ₦1,400 to the U.S. dollar — conditions it says could prevail if the foreign exchange market stabilises, capital inflows strengthen, and the current account returns to surplus. The CBN also factored in an expected daily domestic crude output of about 1.5 million barrels, as part of its baseline scenario for next year.
The bank’s petrol price forecast represents an increase over current market levels, even as fuel costs eased following significant interventions by domestic refining capacity. In December 2025, Dangote Petroleum Refinery cut its gantry price of petrol to ₦699 per litre from higher levels earlier in the year, prompting authorised distributors such as MRS Oil to retail at around ₦739 per litre. That move helped reduce prices at filling stations and offered motorists some relief.
Explaining the broader context of its projections, the CBN stressed that stronger private‑sector investment in domestic refining, expanded processing capacity, improved security around oil assets, and competition in the midstream sector could help moderate energy costs and ease price volatility in 2026. These developments, the bank said, would support market resilience even as global oil price fluctuations and exchange rate dynamics influence domestic pump prices.
Economists interpreting the outlook observe that petrol pricing in Nigeria remains sensitive to both international conditions and domestic policy actions. The presence of significant refining capacity, such as Dangote’s facility — which has been selling petrol directly to marketers and enforcing competitive pump prices — has changed the structure of the downstream market. However, projections like the CBN’s suggest that price pressures could persist, especially if global crude prices rise or supply conditions tighten.
Industry voices have also pointed to the risks associated with a potential return to heavy reliance on fuel imports, a scenario which some producers have warned may push prices even higher. Dangote Petroleum has cautioned that in the absence of robust local supply, retail petrol prices could climb as high as about ₦1,400 per litre, reflecting the greater cost of imported products in a deregulated market environment.
The CBN’s forecast forms part of its broader economic outlook, in which it also expects headline inflation to moderate in 2026, potentially easing to around 12.94 per cent compared with an estimated 21.26 per cent in 2025, partly as a result of stabilising petrol prices and easing food costs.
For consumers and businesses that rely heavily on transportation and petroleum‑based energy inputs, the prospect of fuel prices approaching ₦950 per litre underscores the continued interplay between macroeconomic conditions, refining capacity, foreign exchange movements, and policy reforms affecting Nigeria’s energy sector. The outlook also highlights the importance of sustained investment in refining, infrastructure, and regulatory stability to support affordability and supply reliability in the years ahead.
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