President Tinubu Announces 15% Import Duty on Petrol and Diesel
In a surprising policy shift, President Bola Tinubu has approved a 15 percent ad valorem import duty on premium motor spirit (PMS), commonly known as petrol, and on diesel. The approval, disclosed in a letter dated October 21, 2025, signals a strategic move by the administration to adjust energy and fiscal policy in response to evolving economic conditions. The document, seen by TheCable, was prepared by Damilotun Aderemi, the private secretary to the president, and confirms the government’s intention to modify import taxation on key fuels.
What a 15% Ad Valorem Duty Means for Fuel Imports
Ad valorem duties are assessed as a percentage of the value of imported goods. A 15 percent rate on PMS and diesel means importers will face higher costs when bringing in these fuels. In practical terms, this could influence pump prices, freight costs, and the broader energy market. Analysts warn that such duties may ripple through the economy, potentially impacting transport costs, manufacturing, and consumer goods that rely on diesel-powered logistics.
Rationale and Government Goals
While the full rationale behind the policy adjustment has not been exhaustively detailed in public communiqués, government officials have indicated that the move is part of broader efforts to recalibrate energy pricing, encourage domestic productivity, and bolster revenue from petroleum imports. Proponents argue that the duty can help diversify sources of revenue while gradually aligning domestic fuel prices with global market realities. Critics, however, caution about the potential for higher living costs if downstream prices are passed to consumers.
Implications for Consumers and Industry
For consumers, a 15 percent import duty on petrol and diesel could translate into higher costs at the fuel pump, depending on how traders and retailers respond to the new duty regime. Transport operators, logistics firms, and manufacturers reliant on diesel may experience increased operating expenses, which could be reflected in service charges and product prices over time. The policy may also influence the broader inflation trajectory, a critical concern for households amid ongoing economic pressures.
Impact on Local Refining and Energy Policy
Advocates of local refining and energy independence may view the duty adjustment as a lever to incentivize domestic production. By raising import costs, the administration could push both policymakers and private sector players to prioritize domestic refineries and alternative fuels where feasible. The policy might also be evaluated alongside Nigeria’s ongoing energy reform agenda, with attention to how it interacts with exchange rate dynamics, subsidy debates, and the country’s broader fiscal framework.
Longer-Term Considerations
As Nigeria navigates a complex energy landscape, the 15 percent duty decision will likely be assessed in light of macroeconomic indicators, including inflation, currency stability, and balance of payments. Stakeholders—from policymakers to business leaders and consumer groups—will be watching how this duty affects revenue generation, price formation, and investment signals in the energy sector.
What’s Next?
Officials have indicated that more details, including effective dates, administrative guidelines, and transitional arrangements, will be released through formal channels. In the meantime, businesses involved in the importation and distribution of PMS and diesel should prepare for a higher cost base, while consumers should remain attentive to price movements at service stations and in related sectors.
As the story develops, observers will assess whether the 15 percent ad valorem duty achieves its stated fiscal objectives without unduly burdening households. The administration’s ability to balance revenue needs with affordability will be critical to the policy’s credibility and its reception across Nigeria’s diverse economic landscape.
