The Federal Government has announced plans to introduce a petrol price modulation mechanism that would place a proposed ceiling of ₦1,350 per litre on the ex-gantry or landing cost of petrol.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Thursday, October 8, 2026, during a press briefing on petrol prices and subsidy-related issues in Abuja.
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Oyedele said the proposed arrangement was aimed at providing greater stability in the downstream petroleum market while protecting consumers and industry operators from sharp fluctuations in international crude oil and refined-product prices.
According to the minister, the government is negotiating a ₦1,350-per-litre ceiling on the ex-gantry or landing cost of petrol.
He stressed that the proposed mechanism should not be interpreted as a return to the petrol subsidy regime or conventional price control.
“We are introducing price modulation. The government is negotiating a ceiling of ₦1,350 per litre on the ex-gantry or landing cost of petrol to keep the price stable,” Oyedele said.
“When costs rise above the ceiling, refineries and importers will carry the shortfall and recover it later. This is neither a subsidy nor price control.”
Under the proposed framework, refineries and fuel importers would absorb costs whenever the actual cost of petrol rises above the agreed ceiling.
The difference would subsequently be recovered, allowing the government to moderate the immediate impact of international market volatility on petrol prices.
Oyedele also disclosed plans for the forward sale of crude oil to domestic refineries as part of measures to improve price certainty in the local petroleum market.
He said the arrangement would enable refiners to plan their operations more effectively while providing greater certainty over their crude supply costs.
According to the minister, increasing domestic crude production and the release of previously committed crude would help shield petrol prices from sudden movements in global markets.
“As production rises and previously committed crude is freed up, these will shield pump prices from volatility in the global markets,” he said.
Oyedele described the proposed approach as a sustainable mechanism that could provide greater predictability for both refiners and consumers.
He explained that the government could sell crude to domestic refiners in advance at an agreed price for a specified period.
For instance, he said the government could agree to sell crude to refiners at $80 per barrel for six months, giving operators greater certainty when preparing their budgets and planning production.
“We say to the refiners, for the next six months, we are selling you crude at $80 per barrel, for example. That preserves your budgets, provides certainty to the refiners and price stability to the consumer,” Oyedele said.
The proposed measures come as the Federal Government continues to explore ways of achieving greater stability in the downstream petroleum sector following significant changes in petrol pricing and supply arrangements.
If implemented, the price-modulation framework would shift some of the immediate impact of fluctuations in petrol costs to refiners and importers, with the affected operators expected to recover the difference later.
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The government’s position, as outlined by Oyedele, is that the mechanism would provide price stability without constituting a direct subsidy or traditional price control system.
David Okere is a journalist and contributor to Freelanews.com, covering business, governance, public affairs, and human-interest stories with a commitment to accuracy, balance, and public interest reporting.
