Nigeria’s spending on imported refined petroleum products has dropped sharply over the past two years, reflecting the impact of domestic refining and recent policy reforms.
Data from the Central Bank of Nigeria’s Balance of Payments report show that fuel import expenditure declined by about 54 per cent, falling from $14.58bn in the first nine months of 2023 to $6.71bn during the same period in 2025. The figures indicate a steady year-on-year reduction, with imports easing to $11.38bn between January and September 2024 before declining further in 2025.
The reduction represents a savings of roughly $7.87bn compared to spending levels recorded two years earlier, pointing to a significant drop in foreign exchange outflows linked to fuel imports. According to the CBN data, the sharpest contraction occurred in 2025, when import costs fell by over 40 per cent within nine months.
Analysts say the trend highlights early gains from import substitution as new and rehabilitated refineries increase output.
The moderation in fuel imports has also come alongside broader economic reforms aimed at easing pressure on Nigeria’s external reserves and stabilising the naira.
For decades, Nigeria relied heavily on imported refined petroleum products due to limited local refining capacity and underinvestment in infrastructure.
That dependence made fuel imports one of the country’s biggest drains on foreign exchange. However, the removal of petrol subsidies in 2023, combined with tighter foreign exchange controls, reduced fuel consumption and curbed speculative demand tied to imports.
Market observers also point to increased competition in the downstream sector, driven largely by supplies from the Dangote Petroleum Refinery. The refinery has boosted domestic availability, making it harder for fuel importers to maintain previous volumes.
Despite the progress, Nigeria continues to import refined products. CBN figures show that marketers still spent over $6bn on fuel imports in the first nine months of 2025, underlining that the country has not yet achieved full self-sufficiency.
Energy economist Professor Wumi Iledare cautioned against claims that fuel imports have completely ended. He noted that while domestic refining has reduced Nigeria’s reliance on imported petrol, imports remain an important part of market stability.
According to him, the downstream fuel market is shaped by import-parity pricing, meaning that even when actual imports fall, the option to import continues to influence prices and supply decisions. He added that imports still serve as a buffer against supply disruptions, refinery downtime and sudden demand increases.
Iledare stressed that the Petroleum Industry Act promotes competition and liberalisation, making it unrealistic to declare an end to fuel imports based solely on increased local production. He argued that policy discussions should focus on reduced dependence rather than total elimination.
Meanwhile, the Chief Executive Officer of petroleumprice.ng, Jeremiah Olatide, described the decline in import spending as a major shift for the sector. He linked the trend to growing local refining capacity, noting that the Dangote Refinery’s reported daily supply of over 50 million litres aligns with the CBN’s import data.
Further analysis of the Balance of Payments report shows that fuel imports fell consistently across 2025, dropping from $3.26bn in the first quarter to $1.65bn by the third quarter. However, Nigeria’s total import bill rose during the same period due to higher non-oil imports.
On the export side, earnings from crude oil, gas and refined products improved, supported mainly by stronger crude oil exports, although gas export revenues declined due to infrastructure challenges and global market conditions.
