Marketer Lists Key Factors Behind FG’s Suspension of 15% Fuel Import Duty

|By Babatunji Wusu

The Federal Government’s abrupt suspension of the proposed 15 per cent import duty on petrol and diesel stemmed from inadequate consultation, political concerns, and fears of soaring pump prices, a petroleum products marketer has revealed.

The marketer, who requested anonymity, said the government reversed course after realising that the tariff lacked broad consensus among policymakers and industry stakeholders.

He noted that the decision also followed concerns that the duty would trigger nationwide price hikes, with potential political consequences.

“Personally, I believe there was a lot of pushback from many quarters, even though some supported it,” he said. “From international contributors at the recent MEMAN webinar, value-added tax on fuel is usually about 2 percent. So, the government must have been considering the revenue potential.”

He added that the initial proposal appeared to some Nigerians as an attempt to shield local refineries—particularly one major private refinery—from competition.

According to him, the government’s U-turn was likely influenced by “inadequate consultation within and outside government, political implications of higher pump prices, and considerations towards elections.”

He said the suspension means fuel importation will continue until local refineries can supply adequate volumes. This, he added, will help stabilise the market and prevent any single entity from dominating supply.

The Federal Government had on Thursday halted the planned tariff, assuring Nigerians of sufficient petroleum products nationwide. The duty had earlier sparked mixed reactions from stakeholders and economists, dividing public opinion.