Nigeria’s spending on the importation of refined petroleum products has declined sharply by 54 per cent over two years, falling from $14.58bn in the first nine months of 2023 to $6.71bn in the corresponding period of 2025, according to figures from the Central Bank of Nigeria’s Balance of Payments report.
The data showed that fuel import expenditure dropped from $14.58bn between January and September 2023 to $11.38bn in the same period of 2024, before declining further to $6.71bn within the first nine months of 2025.
The figures are contained in a comparative analysis of the 2023 and 2024 full-year Balance of Payments data and the Q3 2025 Balance of Payments presentation released by the CBN.
Data obtained from the CBN documents indicated a sustained moderation in refined fuel importation, with import bills declining year on year throughout the period under review.
According to the report, Nigeria spent $11.38bn on refined petroleum product imports between January and September 2024, representing a reduction of $3.20bn or 21.9 per cent compared to the $14.58bn recorded during the same period in 2023. This reflected a sharp contraction in foreign exchange outflows associated with refined petroleum imports.
The downward trend accelerated in 2025, as fuel import spending fell by an additional $4.67bn or 41 per cent to $6.71bn within the first nine months of the year, marking the steepest year-on-year decline over the period analysed.
Overall, the figures showed that Nigeria spent $7.87bn less on refined petroleum imports in the first nine months of 2025 than it did during the corresponding period of 2023, underscoring a significant easing of foreign exchange pressure linked to fuel importation.
The CBN data also recorded a 41 per cent year-on-year decline in refined petroleum imports by the third quarter of 2025, suggesting early signs of import substitution as new and rehabilitated refineries gradually scaled up operations.
The PUNCH reports that the reduction in foreign exchange spending on fuel imports has occurred against the backdrop of several structural reforms and market adjustments aimed at easing pressure on Nigeria’s external reserves and stabilising the naira.
For decades, Nigeria depended heavily on imports, particularly refined petroleum products, due to limited domestic productive capacity, weak industrial output and chronic underinvestment in critical infrastructure. This dependence made import financing one of the largest drains on the country’s foreign exchange earnings.
The removal of petrol subsidies in 2023 marked a major turning point, as higher pump prices reduced fuel consumption and curbed arbitrage-driven demand. The policy shift, combined with stricter foreign exchange management by the Central Bank of Nigeria, helped moderate import volumes and limit speculative FX demand linked to fuel importation.
Another contributing factor has been the gradual expansion of domestic supply in the downstream oil sector. Energy experts noted that competition within the market has intensified as marketers increasingly struggle to compete with supplies from the $20bn Dangote Petroleum Refinery located in Lekki.
Despite the decline in import spending, Nigerian fuel marketers still expended an estimated $6.71bn importing refined petroleum products during the review period, highlighting the country’s continued reliance on foreign fuel supplies despite repeated assurances that domestic refining would significantly reduce imports.
Although quarterly fuel import bills declined consistently, the data pointed to persistent structural weaknesses within the downstream oil sector.
Commenting on the development, renowned energy economist Professor Wumi Iledare said Nigeria’s reliance on imported petrol has reduced but has not been eliminated, warning against claims that fuel importation has ended following increased domestic supply from the Dangote Petroleum Refinery.
In a personal note titled “Dangote Refinery, Petrol Imports, and Market Reality,” Iledare said recent claims that Nigeria no longer imports petrol reflect “understandable optimism” but exaggerate the actual conditions of the downstream oil market.
“Recent claims that petrol importation into Nigeria has ended because Dangote Refinery now meets domestic demand reflect understandable optimism, but they overstate economic reality.
“Dangote Refinery has significantly improved domestic supply conditions and reduced Nigeria’s marginal reliance on imported petrol. However, neither Dangote Refinery nor petroleum marketers determine national supply outcomes,” he said.
Iledare, who is also the Executive Director of the Emmanuel Egbogah Foundation in Abuja, acknowledged that the refinery has improved domestic supply conditions and reduced Nigeria’s marginal dependence on imported petrol.
However, he stressed that neither the refinery nor petroleum marketers controls national supply outcomes. According to him, Nigeria’s downstream petrol market operates within an oligopolistic, import-parity–anchored framework, where prices and supply stability are shaped by the option to import rather than the physical arrival of imported cargoes.
“Nigeria’s downstream petrol market operates within an oligopolistic, import-parity–anchored framework, where prices and supply stability are disciplined by the option to import, not merely the act of importing.
“Even when no petrol cargoes are landing, the credible threat of imports remains the market anchor. Importation also continues to serve as a risk-management tool for stock security, demand surges, logistics disruptions, and refinery operational risks,” Iledare said, adding that importation remains a risk-management tool for stock security, demand surges, logistics disruptions and refinery operational risks.
The energy economist further noted that the Petroleum Industry Act entrenches liberalisation and competition in the downstream sector, leaving no room for discretionary claims that petrol imports have ended.
“The PIA does not permit discretionary declarations that imports have ended. Sustainable price stability and energy security arise from market discipline, infrastructure efficiency, foreign exchange liquidity and regulatory credibility, not announcements,” he said.
Iledare argued that policy communication should focus on reduced marginal import dependence rather than import elimination, warning that imprecise language could undermine policy credibility.
“The correct policy framing, therefore, is reduced marginal import dependence, not import elimination. Precision in language matters, because credibility in energy policy is built on economic fundamentals, not celebratory headlines,” he added.
Also commenting, the Chief Executive Officer of petroleumprice.ng, Jeremiah Olatide, described the development as a significant shift in Nigeria’s downstream oil market, driven largely by expanding local refining capacity.
“That’s a significant drop. A 54 per cent reduction in fuel import spending in just two years signals increased local production, largely championed by the Dangote Petroleum Refinery,” Olatide said.
He noted that the refinery’s reported supply of more than 50 million litres of petroleum products daily into the Nigerian market aligns with recent CBN data showing a sharp moderation in refined fuel imports.
According to him, the combination of expanding local refining capacity and residual imports is gradually strengthening Nigeria’s energy security.
“The 50 million litres daily supply of petroleum products into the Nigerian market, according to Dangote Refinery, correlates with the CBN reports. Nigeria is gradually becoming an energy secure country with the combination of local refining and imports,” Olatide said.
Further analysis of quarterly Balance of Payments data showed that refined fuel imports stood at $3.26bn in the first quarter of 2025, before declining to $1.80bn in the second quarter and $1.65bn in the third quarter, reflecting steady moderation across the year.
However, Nigeria’s overall import bill increased during the same period. Total imports rose from $9.20bn in Q1 to $9.62bn in Q2 and $10.30bn in Q3, driven largely by non-oil imports, which climbed to $7.08bn in the third quarter.
On the export side, earnings from crude oil, gas and refined petroleum products improved, rising to $13.05bn in Q3 from $11.25bn in Q1. This growth was driven mainly by crude oil exports, which reached $8.45bn in the third quarter.
Gas exports, however, declined sharply, falling by 30.21 per cent quarter on quarter and 20.07 per cent year on year due to infrastructure constraints and global market pressures.
The continued spending on refined fuel imports comes amid the Federal Government’s long-standing push for energy self-sufficiency.
While recent data indicate that fuel importation is beginning to moderate, analysts noted that Nigeria’s transition to full self-sufficiency will remain incomplete until domestic refineries operate consistently at scale and are able to meet local demand.
