By Peace Udugba -The daily torch media
Energy experts have strongly criticised recent recommendations by the World Bank urging Nigeria to deepen fuel importation and fully liberalise its downstream petroleum sector, warning that such advice could undermine the country’s push for energy independence and violate existing laws.
Speaking during a televised discussion on Nigeria’s economic outlook, energy economist and professor, Ken Ife, described the recommendation as ill-timed and economically regressive. While acknowledging that parts of the World Bank’s Nigeria Development Update were analytically sound, he argued that its position on fuel importation contradicts Nigeria’s long-term strategy of achieving self-reliance through local refining.
“You cannot advise a country that is striving for economic independence to reverse course and return to fuel importation,” Ife said. “Such a recommendation undermines everything Nigeria is trying to build.”
He stressed that the advice runs counter to the provisions of the Petroleum Industry Act (PIA), which mandates the prioritisation of domestic crude supply to local refineries under the Domestic Crude Obligation framework.
“The law is clear—domestic refining must come first. Encouraging a shift back to importation is not only against government policy but also inconsistent with the PIA,” he stated.
Ife further warned that increased reliance on imported fuel would expose Nigeria to global supply shocks, accelerate foreign exchange depletion and discourage investments in the domestic refining sector. According to him, Nigeria is already on track to expand its refining capacity beyond local consumption needs, positioning the country as a potential exporter of refined petroleum products.
“We are building capacity that could exceed domestic demand. It is counterproductive to suggest abandoning that progress for renewed import dependence,” he added.
The economist also questioned the empirical basis of the World Bank’s recommendation, describing it as an unsupported conclusion within an otherwise robust report.
“There is no clear evidence justifying a return to imports, especially at a time when major refining countries are restricting exports,” he said.
Echoing similar concerns, another energy expert, Kelvin Emmanuel, criticised the recommendation as disconnected from prevailing market realities. He disclosed that the World Bank had reportedly withdrawn the contested report from its website, although no official explanation has been provided.
Emmanuel dismissed claims that imported petrol could be cheaper than locally refined products, noting that current global market conditions make such projections unrealistic.
“There is no marketer today that can land petrol in Nigeria at less than ₦1,759 per litre when you account for freight, insurance and other logistics costs,” he said.
He explained that rising crude oil prices, largely driven by geopolitical tensions in the Middle East, have significantly altered global pricing dynamics. According to him, while futures prices hover around $100 per barrel, spot prices—particularly Dated Brent—are considerably higher.
“Dated Brent is trading at about $144 per barrel, translating to roughly ₦1,249 per litre before distribution costs,” Emmanuel noted.
He argued that any perception of cheaper imported fuel could only result from compromised quality standards, a trend he said had occurred in the past.
“The only way imported petrol appears cheaper is when standards are lowered,” he said.
Emmanuel also rejected claims that fuel prices in Nigeria are excessively high, noting that petrol remains relatively cheaper compared to prices in neighbouring African countries.
Addressing inflation and rising living costs, he attributed Nigeria’s challenges to weak enforcement of domestic supply policies rather than resource constraints. He maintained that consistent implementation of the Domestic Crude Obligation would help stabilise fuel prices and reduce volatility.
“Fuel price pressures are largely artificial. If local refiners receive crude as required by law, prices will stabilise,” he explained.
He further cautioned against the World Bank’s suggestion of expanding social safety nets through borrowing, warning that such measures could conflict with Nigeria’s fiscal responsibility framework.
“Social interventions are important, but borrowing to fund consumption is unsustainable. Loans should be tied to capital and human development projects, not handouts,” Emmanuel said.
The experts concluded that Nigeria must remain committed to strengthening its domestic refining capacity and resist policy shifts that could reverse recent gains in the energy sector.
