ABUJA, Nigeria (VOICE OF NAIJA)-An economist and former special adviser on industrialisation to the president of the African Development Bank, Banji Oyelaran-Oyeyinka, has explained why petrol selling at N1,300 per liter is still beyond the reach of many Nigerians earning the N70,000 minimum wage.
In a statement issued on Saturday, Oyelaran-Oyeyinka cautioned against assessing fuel prices by simply converting the naira into foreign currencies, describing such comparisons as misleading.
“When you do a direct conversion of this naira to dollars/pounds, you generate an economic fallacy; it confuses and misleads folks,” he said.
He pointed out that Nigeria’s economic realities marked by low income levels, high inflation, and weak purchasing power make petrol expensive for most citizens, regardless of its stated price.
According to him, fuel pricing should not be viewed in isolation, contrary to how some analysts present it.
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He emphasized that affordability depends largely on earnings and the broader economic environment.
“The price per liter in Nigeria of N1,300… is just one variable in a complex set of development equations,” he said, adding that in low-income economies, many people live at subsistence levels, making petrol more of a luxury than a necessity.
Oyelaran-Oyeyinka further argued that purchasing power parity offers a more accurate way to measure affordability than straightforward currency conversions.
“Purchasing power parity is made clearer not by direct currency conversion, but by how long a worker must labor to earn a given sum,” he explained.
He added: “Low nominal petrol prices in Nigeria do not translate to affordability.”
Petrol prices have risen by over 50 percent in recent weeks, climbing to between N1,361 and N1,380 per liter in Abuja, up from previous levels of N875 to N900.
The increase followed a series of price adjustments by Dangote Refinery, which raised its gantry price to around N1,200 per liter in March.