World Bank clarifies petrol import recommendation, asks Nigeria to adopt phased PMS reforms

World Bank clarifies petrol import recommendation, asks Nigeria to adopt phased PMS reforms

The World Bank Group says Nigeria should prioritise fuel supply stability and targeted social support, even as it considers long-term reforms to the premium motor spirit (PMS) market.

In its April 2026 Nigeria Development Update released on April 7, the World Bank included a recommendation on allowing PMS imports.

In a clarification, the institution said such reforms must be carefully sequenced to avoid undermining energy security.

“Over time, transitioning toward a competitive retail market for Premium Motor Spirit is an important policy direction that requires a well-sequenced implementation strategy that guarantees the quality and standards of all petroleum products,” the bank said.

The World Bank said that current global uncertainties in energy markets mean countries are increasingly prioritising supply security, a consideration it said is also relevant for Nigeria.

The institution added that, in the short term, policy focus should be on protecting vulnerable populations through existing social safety net systems.

“In the case of Nigeria, the focus should be to provide targeted support to the most vulnerable people through their well-functioning social safety net system, and the World Bank Group stands ready to step up its existing support,” the financial institution said.

‘WORLD BANK RECOGNISES FG’S DRIVE FOR STABILITY’

The World Bank also acknowledged steps taken by the federal government and private sector players to stabilise fuel supply.

“The World Bank Group recognises the efforts of the Government of Nigeria and the Nigerian private sector in taking concrete steps to safeguard fuel supply– a foundation that is essential to protect consumers and businesses,” the Bretton Woods institution added.

In the April NDU report, World Bank said imported petrol is about 12 percent cheaper than fuel supplied by the Dangote Petroleum Refinery, highlighting distortions in the domestic pricing structure.

“Dangote refinery — the main supplier of refined petrol after the regulator ceased issuing import licences in early 2026 — raised the ex-depot price of Premium Motor Spirit to about N1,275 per litre as of March 23, 2026, compared to an estimated import-parity price of around N1,122 per litre, implying a cost differential of roughly 12 percent,” the report said.

The bank added that rising global oil prices, driven by tensions in the Middle East, could worsen inflationary pressures.

“Overall, an increase in oil prices to about $80 per barrel would directly add around 3.1 percentage points to headline inflation under a full pass-through assumption… as higher fuel and electricity prices also raise transportation and logistics costs across the economy,” the financial institution said.

Also, earlier today, TheCable reported that the World Bank deleted its Nigeria Development Update (NDU) report from its website.

The removal comes three days after the global body published the report.