The Nigerian Bureau of Statistics (NBS) reveals that the average retail price of Automotive Gas Oil (Diesel) experienced a substantial 59.51% year-over-year increase, soaring from N840.81 per litre in March 2023 to N1,341.16 per litre in March 2024.
Additionally, on a month-to-month basis, the price surged by 6.69%, climbing from N1,257.06 in February 2024 to N1,341.16 in March 2024.
State and Regional Disparities
An analysis of state-level price discrepancies in March 2024 unveils Edo State, Jigawa State, and Cross River as the areas with the highest average prices, reaching N1,566.67, N1,533.33, and N1,532.71. In contrast, Plateau State, Niger State, and Adamawa State recorded the lowest prices at N1,067.25, N1,140.00, and N1,175.00 respectively.
Regarding regional breakdown, the South South Zone posted the highest average price for Automotive Gas Oil (Diesel) at N1,419.35. At the same time, the North Central Zone reported the lowest price at N1,230.98 compared to other zones.
Key Insights
Diesel prices have increased since mid-last year, breaching the N1,000 per litre mark.
In response to this surge, the federal government suspended the 7.5% Value Added Tax (VAT) on diesel for six months starting October last year. This measure aimed to mitigate the impact of fuel subsidy removal and address the escalating cost of living crisis.
However, the VAT waiver expired on March 31st, 2024, and the federal government has not disclosed its subsequent course of action.
The recent commencement of Automotive Gas Oil (Diesel) distribution by the Dangote refinery signifies a step towards reducing Nigeria’s dependence on imported diesel.
Notably, the Dangote refinery claims to have reduced the diesel price to N1,000 per litre upon distribution initiation. Nonetheless, independent verification of this gesture and its long-term feasibility remain pending, raising questions about market sustainability.
These developments underscore the challenges posed by rising diesel prices and highlight the need for effective strategies to manage fuel costs and enhance energy sustainability in Nigeria.
