Business
Petrol Subsidy Hits N905.27bn, As Oil Rises To $79.71
The Nigerian National Petroleum Corporation (NNPC) spent a total of N905.27 billion on petrol subsidy in eight months amid rising global oil prices, the latest data obtained from the corporation show.
With the international oil benchmark, Brent crude, nearing $80 per barrel on Monday (up 2.07 per cent at $79.71 per barrel as of 7:00pm Nigerian time), the landing cost of imported petrol and subsidy are expected to increase.
The subsidy, which the NNPC prefers to call ‘value shortfall’ or ‘under-recovery’, resurfaced in January this year as the government left the pump price of petrol unchanged at N162-N165 per litre despite the increase in global oil prices.
The Federal Government had in March 2020 removed petrol subsidy after reducing the pump price of the product to N125 per litre from N145 following the sharp drop in crude oil prices.
The NNPC, which has been the sole importer of petrol into the country in recent years, has been bearing the subsidy cost since it resurfaced.
Data from the corporation showed that it incurred N25.37 billion subsidy cost in January, N60.40 billion in February, N111.97 billion in March, and N126.30 billion in April and N114.34 billion in May.
The subsidy cost rose from N143.29 billion in June to N175.32 billion in July but fell to N149.28 billion in August, according to the NNPC.
The August 2021 value shortfall of N149,283,084,869.20 is to be deducted from the September 2021 proceeds due for sharing at the October, 2021 FAAC meeting, the corporation said in a document on Monday.
While marketers have continued to stress the need to allow market forces to determine the pump price of petrol and do away with subsidy, it remains uncertain whether the discussions between the Federal Government and labour unions will lead to the deregulation of petrol prices.
Analysts at CSL Stockbrokers Limited noted that with no provision for petrol subsidy in the 2021 budget, the NNPC had resorted to direct deduction from FAAC remittance.
“These deductions affect the revenues accruable to the federation,” they said in a note on Friday.
According to them, a steep naira devaluation and an increase in global crude prices, which implies an increase in the landing cost of petrol on many occasions, have caused the continuation of the subsidy regime.
The analysts said, “The deregulation of the downstream oil sector remains a politically sensitive discourse. Deregulating the downstream sector, which would in most times involve raising the pump price of petrol with increasing oil price, is always a challenge in a country where the subsidy on petrol prices is seen as the only source of social security.
“We have always expressed concerns that the current timing by the government to get rid of the longstanding subsidies is inopportune.
“In effect, the government may be forced to retain the subsidy, given the impact of the pandemic, high food prices and hike in electricity tariffs on the already squeezed Nigerian consumers.”
In another development, analysts at Goldman Sachs have raised their year-end forecast on Brent crude to $90 per barrel from a previous forecast of $80, citing the aftereffects of Hurricane Ida in the United States and rising demand, particularly in Asia.
The analysts said Ida should prove to be the most bullish hurricane in US history, cancelling the ramp-up in output from the Organisation of the Petroleum Exporting Countries and its allies since July.
“While we have long held a bullish oil view, the current global supply-demand deficit is larger than we expected” they said.
They added that recovery in global demand from the Delta impact was faster than above-consensus forecast, with global supply remaining short of below consensus forecasts.
Cornerstone of Financial Services
A survey of more than 1 000 global finance leaders undertaken by digital payment network Ripple shows that 72% of respondents believe they need to offer a digital asset solution to remain competitive.
According to Ripple, leaders from the banking, fintech, corporate and asset management sector have made it clear that the “digital asset revolution is happening now”.
“Digital assets are quickly becoming a cornerstone of financial services, underpinned by progressive regulation, growing interest from Tier-1 banks, a steady consumer shift from banks to fintech providers, and booming stablecoin adoption,” Ripple says.
The survey was conducted in early 2026 and the findings released in March.
Stablecoin Boon or Bane?
Ripple has experienced significant success in the stablecoin sector since launching its Ripple USD (RLUSD) stablecoin in 2024.
With a market cap of $1.56 billion, it is considered a major regulated player in the market.
No doubt the platform was pleased to learn through its own survey that financial leaders were most bullish about stablecoins.
Roughly three-quarters of respondents believed they could boost cash-flow efficiency and unlock trapped working capital.
Ripple noted that finance leaders were thinking about stablecoins as more than “just a new way to execute payments”; instead, they viewed them as effective tools for treasury management.
In March 2026, Ripple began testing a new trade finance model built around RLUSD in a bid to increase the speed of cross-border payments.
The pilot initiative, developed alongside supply chain finance company Unloq [https://unloq.com], is running on the XRP Ledger inside a testing framework developed by the Monetary Authority of Singapore.
The Asian city-state is one of the platform’s biggest growth markets.
The idea behind the project is to see whether stablecoin-based settlement can streamline trade finance, too often hampered by reliance on intermediaries and slow reconciliation.
The only potential drawback is that if the initiative takes off, the Ripple to USD price could be negatively affected.
Ripple has always championed its native XRP token as a bridge asset, the “middleman” in the process of a financial institution turning dollars in the US into pounds in the UK, for example.
Ripple converts dollars into XRP and then back into pounds.
If RLUSD can do exactly the same thing, questions will be asked about XRP’s relevance.
That is a bridge Ripple will have to cross if it gets to that point.
Tokenisation Partners
Another interesting finding from Ripple’s survey is that most banks and asset managers are seeking tokenisation partners to help execute their strategies.
Some 89% of respondents said digital asset storage and custody were top priority. “Token servicing/lifecycle management also ranks highly for banks at 82%, while asset managers place greater emphasis on primary distribution at 80%,” Ripple found.
The survey also revealed that just more than half of fintechs and financial institutions want an infrastructure provider that can offer a “one-stop-shop solution”. This rose to 71% among corporate financial leaders.
Ripple attributes this to institutions and firms wanting uncomplicated, cohesive systems.
Infrastructure Rules
In its final analysis, Ripple says companies across the board are looking for partners and solutions that are “secure, compliant, battle-tested and that enable growth and execution”.
“The message is clear: infrastructure decisions made today will shape competitive positioning tomorrow.”
No surprise that this is precisely where Ripple is placing much of its focus.
