Falana demands petrol price cut amid global oil supply disruptions

Human rights lawyer and Senior Advocate of Nigeria (SAN), Femi Falana, has urged the Federal Government to cut the price of petrol, pointing to global oil disruptions and local production challenges. In a statement released on October 4, 2026, under the Alliance on Surviving COVID-19 and Beyond (ASCAB), Falana cited the conflict between the United States and Iran, which has disrupted crude oil shipments through the Strait of Hormuz, pushing prices above $100 per barrel.

Falana referenced a recent ASCAB seminar where petroleum expert Prof. Izielen Agbon criticized Nigeria’s fuel pricing structure. Agbon argued that the country’s fuel subsidy is based on 'manipulated production methods and accounting statistics,' and that Nigerians should not pay more for petrol than consumers in oil-producing regions like Texas. He proposed adopting a Production Cost Pricing (PCP) model instead of the current Import Parity Price (IPP) model, which assumes petroleum products are imported despite Nigeria being a crude oil producer.

Agbon estimated that the cost of producing crude oil in Nigeria ranges from $31 to $48 per barrel, significantly higher than the global average of $12 per barrel. He attributed this to ageing infrastructure, insecurity, oil theft, and reliance on imported inputs. Based on these figures and an exchange rate of N1,333 per dollar, Agbon suggested petrol prices should range between N435 and N687 per litre.

Falana also highlighted measures taken by other countries to address rising energy costs, such as the G7’s decision to release 100 million barrels of crude oil and diesel from emergency reserves. He expressed concern over the state of Nigeria’s refineries, noting that despite previous announcements by the Nigerian National Petroleum Company Limited (NNPC Ltd) about resuming operations at the Port Harcourt and Warri refineries in December 2024, these facilities have yet to impact domestic supply meaningfully.

Falana maintained that the government could reduce petrol prices by ensuring crude oil allocated for domestic consumption is refined locally. He called on the government to direct NNPC Ltd to refine 450,000 barrels per day domestically and make petroleum products more affordable for Nigerians.