Experts Slam World Bank over Fuel Import Advice
…Cite Breach of Petroleum Act
By Patience Ikpeme
Energy experts and economists have voiced strong opposition to recent policy recommendations by the World Bank, which advised Nigeria to expand its reliance on fuel importation and fully liberalise its downstream petroleum sector.
Critics of the global lender’s stance argue that the prescription is economically regressive and stands in direct contradiction to the Petroleum Industry Act (PIA). They contend that such advice threatens Nigeria’s sovereign goal of energy independence at a time when local refining capacity is finally seeing significant growth.
Ken Ife, a prominent professor and energy economist, addressed the issue during a televised interview focused on the nation’s economic trajectory. While he acknowledged that certain aspects of the World Bank’s latest Nigeria Development Update were analytically sound, he pointed out that the push for importation is a strategic misstep.
“You cannot come to a country that is struggling, and which has just developed a vision of economic self-reliance and then advise it to reverse course and return to fuel importation,” Ife said. “That kind of recommendation undermines everything Nigeria is trying to achieve.”
The economist noted that the recommendation ignores the legal framework established by the PIA, which mandates that domestic crude be supplied to local refiners first under the Domestic Crude Obligation. “The law is very clear. Domestic refining must come first. Advising Nigeria to abandon that path is not just against government policy; it is a clear violation of the PIA,” Ife stated.
According to Prof. Ife, a return to heavy importation would heighten Nigeria’s exposure to global supply chain shocks, drain foreign exchange reserves, and stifle the momentum of private sector investments in the refining sector. He expressed confusion over how the conclusion was reached, describing it as a “strange” addition to the report.
“This conclusion was strangely parachuted into what was largely a strong analysis. There is no evidence supporting a return to imports at a time when major refining countries are restricting exports,” he said.
Joining the critique, energy expert Kelvin Emmanuel described the World Bank’s position as disconnected from the actual state of the global oil market. Emmanuel further revealed that the controversial document appeared to have been removed from the lender’s official channels following the backlash.
“The World Bank has retracted the report. If you check the World Bank Nigeria website, you will see that the document has been taken down,” Emmanuel claimed.
He challenged the narrative that imported fuel could be more affordable than products refined within Nigeria, citing the high costs associated with freight, insurance, and the current price of crude oil on the international market. “There is no marketer today that can land petrol into Nigeria at less than ₦1,759 per litre when you factor in freight, insurance and supply chain risks,” Emmanuel said.
With Middle East tensions driving Brent crude prices higher, Emmanuel explained that the math for cheap imports simply does not add up unless quality is sacrificed. “The only way imported petrol can appear cheaper is if standards are compromised, which, historically, has been the case,” he said.
Beyond the petroleum sector, the experts took issue with the World Bank’s suggestion that Nigeria should fund social safety nets through further borrowing. Emmanuel argued that this approach violates fiscal responsibility principles.
“Social safety nets are important, but you do not borrow money to share. Borrowing is meant for capital projects and human development, not consumption. If support is needed, it should come in the form of grants, not loans,” he said.
The consensus among these analysts remains that Nigeria’s path to stability lies in the strict enforcement of domestic crude supply laws rather than a return to the era of total import dependence.
