Dollarisation of fuel sales will weaken naira further, LCCI warns
By Aboki Forex —
The Lagos Chamber of Commerce and Industry (LCCI) has warned that dollar-denominated transactions in the downstream petroleum sector will pile additional pressure on Nigeria’s foreign exchange market and could further weaken the naira. LCCI President Engr. Leye Kupoluyi gave the warning in an interview with New Telegraph in Lagos, saying the trend raises operational costs in the sector.
LCCI calls for naira-denominated transactions and stronger price regulation
Kupoluyi urged the authorities to promote naira-denominated transactions within the domestic petroleum value chain. He called on industry stakeholders to develop policies that safeguard exchange rate stability and support macroeconomic resilience. He also asked the Federal Competition and Consumer Protection Commission (FCCPC) to be more vigilant on price regulation. “We have had cases where oil marketers raised pump prices in line with international crude oil prices, but held on to current prices when international prices fell,” Kupoluyi said. “We need to study the dynamics at play and secure the best deal for consumers and businesses. There are also cases of price-fixing by local airlines during peak festive seasons. We are not calling for price control but for price regulation in line with international best practices.”
Asymmetric petrol pricing and consumer protection concerns
The LCCI chieftain stressed that businesses and consumers continue to express concern over the persistent asymmetry in domestic petrol pricing. “Increases in international crude oil prices are promptly reflected in local pump prices, while corresponding decreases are rarely passed on to consumers,” he said. “This raises concerns about market transparency, pricing fairness, and consumer protection.” He called on the FCCPC, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and other agencies to strengthen oversight of pricing mechanisms and protect consumers from exploitative practices.
Nigeria-Morocco gas pipeline: a chance to boost FX earnings
On the ECOWAS approval of the Nigeria-Morocco gas pipeline, Kupoluyi described it as a major opportunity. The roughly 6,000-kilometre (3,700-mile) pipeline will cross 13 countries along Africa’s Atlantic coast. “This paves the way for Nigeria to explore its gas resources for maximum foreign exchange earnings, serving Europe and Africa,” he said. With geopolitical tensions in the Middle East and disrupted gas supply from Russia to Europe, Kupoluyi said Nigeria must seize the chance to become Europe’s major gas supplier. He urged the government to allow private-sector participation in funding the project to enhance management and profitability.
Marketers warn: Nigerians may soon buy petrol in dollars
Reacting to the dollarisation trend, petroleum products retailers and marketers said Nigerians may soon begin buying petrol, diesel, and other refined products in US dollars if the Federal Government does not restore the naira-for-crude deal with Dangote Refinery. Billy Gillis-Harry, National President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), disclosed this in an interview. Dangote Refinery recently resumed selling refined products in dollars, signalling the suspension of the naira-for-crude deal that allowed off-takers to buy in naira from the 700,000-barrel-per-day plant. The government had yet to comment officially, though speculation suggests talks to restore the deal have begun. “Nigerians may start buying petrol in US dollars if the Federal Government does not intervene,” Gillis-Harry said. “We hope the downstream oil sector will not be dollarised to that extent.” Currently, petrol sells for between N1,155 and N1,220 per litre, and diesel between N1,700 and N1,800 per litre in Abuja and its environs.
For the naira and Nigerian consumers, the warning from LCCI and PETROAN is clear: dollarisation of fuel sales will amplify forex demand, weaken the currency further, and raise pump prices for ordinary Nigerians who earn in naira. Urgent government action on the naira-for-crude deal and tighter price oversight may be needed to shield the economy and households from another wave of inflationary pressure.