ESCALATING tensions across the Middle East are beginning to take a direct toll on Nigerian households and businesses, as the cost of cooking gas and petrol rises sharply in major cities, including Lagos and Abuja.
The surge in prices follows renewed security concerns around the Strait of Hormuz, a narrow but strategic waterway through which a significant portion of the world’s oil and liquefied natural gas supplies pass. Disruptions and heightened risk premiums on vessels navigating the corridor have driven up global energy prices, with ripple effects felt in import-dependent countries like Nigeria.
Riing energy prices
Africa’s largest refinery, Dangote Petroleum Refinery, has added N100 per litre to the gantry price of fuel, driving up energy costs faced by homes and businesses. Dangote Refinery raised its ex-depot price of Premium Motor Spirit (PMS) to N874 per litre, up from N774.
Consequently, petrol prices at filling stations have risen to N930/litre and N1000/litre across Lagos, Abuja, Port Harcourt and different parts of Nigeria.
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“I bought N935 in the Ejigbo area of Lagos on Tuesday,” said a businessman, Mr Saheed Olaoluwa. “I have to decide whether to drive my car every day now or to park it and use commercial buses.”
In Abuja, petrol prices went from less than N860/litre to N970 in the Central Business Area, with outskirts of the city such as Kubwa, Kwali, Dutse, Dei Dei, Kuchigoro and Gwagwalada selling between N940/litre and N980/litre.
“I bought a litre for N950 per litre in Kubwa for my hair cut business,” said an operator of a barber’s shop, Mr Odirachukwu Nwanma.
Gas prices have also risen in the same direction. Depot owners across Nigeria have raised the price of liquefied petroleum gas (LPG), commonly known as cooking gas, by an average of N100 per kilogramme. This means households will have to increase their spend on cooking gas until the Iran-U.S. crisis subsides.
For companies and households using diesel, the story is also the same. Dangote Refinery has raised its ex-depot price of automotive gas oil (AGO), also known as diesel, from N880 to N1,050 per litre. Filling stations now sell between N1,150 to N1,250 per litre, adding burden on firms’ cost of production.
Transport costs
Although Nigeria is Africa’s largest oil producer, it still imports refined petroleum products. Though Dangote Refinery boosted its output to 40 million per day in January 2026, it was still not enough for the populace as imports stood at 24.8 million litres per day.
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International benchmark prices have climbed in the past week, pushing up landing costs and forcing retail price adjustments. Brent price, the global benchmark, stood at $83.54 per barrel on Wednesday morning Nigerian time, with the Nigerian Bonny Light at $78.62 per barrel, marking a 2.30 percent loss over a one-day period.
Though there have not been pronounced increases in transport fares, economists anticipate that further increases in the petrol price will drive up transport costs.
“We have not increased our fares, but if this continues, then it leaves us with no option,” said a Lagos-based manager of a transport company.
Negative impact on Nigerians
Energy traders point to broader production adjustments within the oil alliance led by the Organization of the Petroleum Exporting Countries and its partners (OPEC+), which have tightened global supply. Combined with fears of prolonged instability in key producing nations, crude oil prices have rebounded on international markets.
For many low- and middle-income Nigerians, the rising cost of LPG is seen forcing a return to more traditional cooking fuels such as firewood and charcoal, raising environmental and public health concerns. Clean energy advocates warn that sustained price hikes could reverse progress made in promoting gas as a safer alternative.
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“The affordability of cooking gas is crucial for energy transition at the household level,” said an energy economist based in Abuja, Ms Sandra Bright. “If prices keep climbing, families will revert to cheaper but more harmful options.”
Economists warn that prolonged instability in the Middle East could sustain elevated energy prices globally. Countries such as Saudi Arabia and Iran play central roles in global oil supply, and any disruption involving them tends to reverberate across markets.
The price increases could trigger headline inflation and worsen the cost-of-living crisis for Nigerian households, while oreventing the Central Bank of Nigeria (CBN) from embarking on further rate cuts to ease borrowing for businesses.
Centre for the Promotion of Private Enterprise (CPPE) Chief Executive Officer, Dr Muda Yusuf, has warned that the renewed geopolitical tensions could raise government revenues. He said households, however, could face worsening cost-of-living pressures, potentially deepening poverty levels.
“Thus, while government revenues may rise, household welfare could deteriorate—creating a divergence between fiscal gains and social outcomes,” Yusuf noted.
