Nigeria’s ex-depot price of Automotive Gas Oil (AGO), commonly known as diesel, has increased by about 3% to ₦1,450 per litre, marking a reversal of the recent decline in wholesale prices as stronger global crude oil prices pushed up supply costs.
Industry sources said depot operators revised the bulk selling price from approximately ₦1,410 per litre within 24 hours, reflecting renewed pressure from the international oil market.
The increase followed a sharp rally in crude prices after heightened geopolitical tensions in the Middle East raised concerns over potential disruptions to global oil supplies. Brent crude, the international benchmark, climbed 5.66% to settle at $78.36 per barrel on Tuesday, prompting marketers to adjust domestic diesel prices in line with higher import replacement costs.
The ex-depot price represents the wholesale cost at which fuel marketers purchase diesel directly from storage depots before transportation, distribution and retail margins are added. As a result, motorists and commercial consumers are expected to face higher pump prices in the coming days as filling stations pass on the increased acquisition costs.
The latest adjustment adds fresh cost pressures for businesses that depend heavily on diesel-powered generators because of Nigeria’s persistent electricity supply challenges. Manufacturers, telecommunications companies, construction firms, transport operators and logistics providers are among the largest consumers of diesel, making the fuel a critical input for business operations.
Higher diesel prices also raise the risk of increased production and transportation costs, which could eventually translate into higher prices for consumer goods and services, adding to inflationary pressures in Africa’s largest economy.
Market participants said the price increase reflects prevailing international market conditions rather than changes in domestic supply fundamentals. Depot operators noted that fluctuations in global crude oil prices, freight costs and foreign exchange rates remain the key drivers of wholesale diesel pricing in Nigeria.
Although Nigeria has expanded domestic refining capacity in recent years, imported petroleum products and international pricing benchmarks continue to influence local fuel prices, particularly during periods of heightened volatility in the global energy market.
Analysts say diesel prices are likely to remain sensitive to developments in the Middle East and movements in crude oil futures. Should geopolitical tensions persist and international oil prices remain elevated, wholesale and retail diesel prices could experience further upward adjustments in the weeks ahead, increasing operating costs for businesses and potentially slowing the pace of disinflation.
