Petrol import bill drops 4% in Q1 2023

Nigeria’s petrol import bill fell by four percent to N1.49 trillion in the first quarter of this year and experts say changes in crude oil prices, exchange rates, and market demand may have been responsible.

Africa’s largest economy relies wholly on imports to meet its fuel needs, as its refineries have remained in disrepair for many years.

Data sourced from the National Bureau of Statistics (NBS) showed Nigeria spent a total of N1.56 trillion in Q4, 2022, N1.19 trillion in Q3, 2022, N948 billion in Q2, 2022 and N1.51 trillion in Q1, 2022.

Mike Osatuyi, national operations controller at the Independent Petroleum Marketers Association of Nigeria (IPMAN), told BusinessDay that the decline in petrol import bills can be attributed to changes in crude oil prices and exchange rates.

“The amount of money spent on importing petrol is influenced by changes in crude oil prices and the exchange rate used to import the product. “If crude oil prices rise or fall, it affects the amount of money spent on importing petrol,” Osatuyi said.

This import bill is expected to decline further as subsidy removal moderates demand and curbs the smuggling of imported products.

BusinessDay analysis showed that average quarterly Brent crude prices, the international oil benchmark, dropped by six percent from $88.5 per barrel in the fourth quarter of last year to $83 per barrel in the first quarter of this year.

From the first quarter of 2022 to that of 2023, petrol accounted for the highest share of all imported products. The product accounted for 25.54 percent, 17.46 percent, 21.18 percent, 29.06 percent, and 26.84 percent in Q1 to Q4 2022 and Q1 2023 respectively.