Nigeria’s downstream energy market may be heading for a period of sustained relief as the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has projected continued declines in the prices of petrol, diesel and Liquefied Petroleum Gas (LPG) nationwide. The development comes amid rising supply, intensifying competition and expanding private sector investments across the oil and gas value chain.
Speaking during an inspection of Aradel Holdings Plc facilities in Ogbele community, Ahoada East Local Government Area of Rivers State, the Authority’s Chief Executive, Mr Saidu Mohammed, expressed optimism that Nigerians would increasingly enjoy more affordable energy as market forces stabilise prices.
Akahi News gathered that the inspection formed part of a three-day operational tour of key midstream assets in Rivers State, aimed at assessing local capacity and investment readiness in the sector.
Rising Supply Driving Down Fuel Prices
According to Mohammed, increased product availability is already reshaping the market, with competition pushing prices downward. He pointed out that petrol prices have dropped significantly in many areas, falling from about ₦1,000 per litre to roughly ₦800 per litre in some markets.
“The more supply we have, the lower the price, and this is already evident as competition continues to reshape the market,” Mohammed reportedly said.
Observers noted that the trend reflects the gradual stabilisation of the post-subsidy era, where pricing is increasingly determined by demand and supply dynamics rather than government intervention. Akahi News learnt that industry stakeholders believe sustained investments in refining and distribution infrastructure could further cushion consumers from price volatility.
Mohammed maintained that the removal of fuel subsidy had allowed the downstream sector to operate more efficiently, encouraging private investors to expand capacity and improve logistics.
“Sustained competition, rather than subsidies, will guarantee adequate supply of petrol and gas at affordable prices for Nigerians,” he added.
Refining Capacity and Export Ambitions
Beyond domestic price stability, the NMDPRA chief highlighted Nigeria’s broader ambition to evolve into a net exporter of petroleum products to markets across Africa, Europe and the Americas. However, he stressed that local demand must first be adequately satisfied before large-scale exports can commence.
He also underscored the importance of building additional refineries with advanced conversion capacity capable of producing diesel, fuel oil, naphtha, LPG and petrol. Analysts believe that expanding local refining capacity would reduce dependence on imports, conserve foreign exchange and strengthen energy security.
On the operational state of government-owned refineries, Mohammed explained that their management remained largely under the Nigerian National Petroleum Company Limited (NNPCL). Nevertheless, NMDPRA is engaging the company to ensure improved delivery of crude oil and petroleum products to the Port Harcourt and Warri refinery reserves.
“Delivery of products to the reserves and restoring loading activities at the refineries will boost local economies and revive product distribution within host communities,” he said, adding that Nigerians could begin to feel the economic impact even before full-scale refinery operations resume.
Akahi News gathered that renewed loading activities could stimulate ancillary businesses, create jobs and strengthen regional supply chains.
Tinubu’s Free-Market Policy and Private Sector Momentum
Mohammed recalled that President Bola Tinubu’s decision to remove fuel subsidy was his first major policy action in office, signalling a firm commitment to a free-market economy. According to him, the policy has unlocked private sector participation and stimulated investments across the oil and gas value chain.
Observers noted that while subsidy removal initially triggered price shocks and public concerns, the gradual emergence of competitive pricing and improved supply could reshape public perception in the medium term.
The NMDPRA boss further noted that Nigeria’s long-term economic growth depended heavily on the rapid expansion of locally-owned midstream assets, describing the midstream segment as one of the strongest drivers of industrial growth.
He argued that facilities inspected in Rivers State demonstrated that Nigerian companies now possess the technical and financial capacity to design, build and sustainably operate world-class energy infrastructure.
Aradel Holdings as a Model of Local Capacity
Mohammed singled out Aradel Holdings Plc as a compelling example of indigenous competence in refinery operations, noting that the company had proven it could efficiently operate a refinery sustainably without foreign operatorship.
According to him, Aradel currently operates an 11,000-barrels-per-day refinery and has supplied gas to Nigeria Liquefied Natural Gas (NLNG) for about 13 years. The company also runs a virtual gas pipeline, producing compressed natural gas distributed across several parts of Nigeria.
He disclosed that Aradel’s ongoing expansion project is expected to enable petrol loading from its facility before the end of 2027 — a development that could further deepen local supply and competition.
Industry analysts believe that the emergence of multiple indigenous refiners could significantly reshape Nigeria’s downstream landscape, reducing import dependency and improving price stability over time. Akahi News gathered that stakeholders caution, however, that consistent regulatory clarity and infrastructure support remain critical to sustaining investor confidence.
Dangote Refinery Not Enough for Growing Demand
Mohammed also cautioned that the Dangote Refinery alone could not meet Nigeria’s domestic, continental and global demand, stressing the need for diversified refining investments.
He described the midstream sector as a powerful catalyst capable of stimulating manufacturing, power generation, transportation and other productive sectors of the economy. To sustain momentum, he assured investors that NMDPRA would continue to provide regulatory incentives aimed at attracting large-scale investments into the sector.
Responding on behalf of Aradel Holdings, the company’s Managing Director, Mr Adegbite Falade, thanked the regulator for its support and reaffirmed the company’s commitment to expanding refining capacity, commercialising gas and eliminating routine gas flaring.
“We are not overwhelmed by rising demand, as the company is already expanding its refining capacity beyond current levels,” Falade reportedly said. He added that Aradel aims to contribute meaningfully to Nigeria’s long-term energy security through local value addition and prioritisation of domestic energy needs.
Outlook: A Gradual Shift Towards Energy Affordability
While short-term market fluctuations remain possible due to global oil dynamics, logistics constraints and currency pressures, analysts believe that sustained local refining expansion and competitive supply chains could gradually stabilise fuel prices nationwide.
Akahi News gathered that the real test will lie in how quickly new and existing refineries scale up production, how efficiently distribution networks improve, and whether regulatory consistency is maintained to attract long-term investments.
If current trends continue, Nigerians may increasingly experience moderate price relief, improved product availability and stronger local economic activity — signalling a slow but meaningful transition towards a more resilient, market-driven energy sector.
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