NMDPRA seeks to introduce fresh regulations to prohibit petrol price manipulation and manufactured shortages

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The Nigerian Midstream and Downstream Petroleum Regulatory Authority has unveiled sweeping draft regulations that would prohibit petroleum companies from fixing fuel prices, restricting product supply, sharing markets or coordinating commercial decisions capable of distorting competition across Nigeria’s midstream and downstream petroleum industry.

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The proposed Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations, 2026, seek to dismantle anti-competitive conduct ranging from pump price coordination and artificial scarcity to bid rigging, customer allocation, exclusive supply arrangements and the exchange of commercially sensitive information among competitors.

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The move comes amid renewed concerns over pricing practices in the downstream petroleum sector following allegations by independent marketers in July that some major fuel importers were selling imported Premium Motor Spirit at coordinated prices significantly above those of the Dangote Petroleum Refinery.

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In a public notice issued on Thursday and posted on its official X handle, the Authority invited licensees, permit holders and other stakeholders to submit comments on the proposed regulations within 21 days, in compliance with Section 216(1) of the Petroleum Industry Act 2021, which requires stakeholder consultation before regulations are finalised.

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The notice, signed by the Authority’s Chief Executive, Rabiu A. Umar, stated that stakeholders could review the draft regulations on the Authority’s website and submit observations before the consultation period closes.

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It added that a stakeholders’ consultation forum on the proposed regulations would be held on September 22, 2026, at the Authority’s headquarters in Abuja.

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The notice read in part, “In compliance with Section 216(1) of the Petroleum Industry Act 2021 requiring consultation with stakeholders before the finalisation of Regulations, the Nigerian Midstream and Downstream Petroleum Regulatory Authority hereby invites licensees, permit holders and other stakeholders to make submissions within twenty-one (21) days from the date of this publication in respect of the proposed Midstream and Downstream Petroleum Prevention of Anti-Competitive Practices and Behaviour Regulations.”

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It added, “Stakeholders are enjoined to visit the Authority’s website to review the proposed Regulations. All submissions are to be made using the format accessible on the Authority’s website and must be received not later than 21 days from the date of this notice.”

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A review of the draft regulations by The PUNCH showed that the Authority intends to outlaw virtually every form of coordinated conduct capable of weakening competition in the petroleum market.

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Under Part IV, titled Collusive Agreements and Anti-Competitive Coordination, the draft regulations prohibit petroleum companies from entering into formal or informal agreements designed to influence prices, allocate markets or manipulate commercial outcomes.

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The draft states, “No licensee, market participant, or group of undertakings in the midstream or downstream petroleum sector shall enter into any agreement, arrangement, understanding, or concerted practice, whether formal or informal, written or oral, explicit or tacit, that has the object or effect of preventing, restricting, or distorting competition.”

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The regulations specifically identify price-fixing or coordinated pricing behaviour as prohibited conduct.

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According to the draft, “Price-Fixing or Coordinated Pricing Behaviour, agreeing, aligning, or coordinating prices or any pricing element, including pump prices, ex-depot prices, margins, discounts, surcharges, freight/delivery charges, or pricing formulas/benchmarks,” shall be prohibited.

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If approved, petroleum companies would no longer be permitted to coordinate pump prices, ex-depot prices, freight charges, discounts, pricing benchmarks or other commercial elements that could influence retail fuel prices.

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The proposed framework also bans market allocation arrangements, where competitors divide customers, geographical territories, product lines or supply areas among themselves instead of competing freely.

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Similarly, companies would be prohibited from engaging in bid rigging or collusive tendering, practices that undermine transparency and competition during procurement processes.

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The Authority is also proposing stringent measures against collective supply restrictions capable of creating fuel shortages or manipulating market prices.

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The draft regulations prohibit competitors from jointly reducing production volumes, petroleum imports, throughput or product supply to create artificial scarcity or influence prices.

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The proposal also extends to tacit collusion, where competitors avoid direct agreements but signal future pricing intentions or strategic commercial decisions through public statements, trade associations or indirect channels.

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The regulations prohibit the exchange of commercially sensitive information, including future pricing plans, production schedules, customer lists, marketing strategies and bidding intentions where such disclosures could reduce competition.

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Such provisions are designed to prevent companies from coordinating behaviour without signing formal agreements, a practice competition regulators across several jurisdictions increasingly monitor.

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The Authority is equally seeking to curb restrictive commercial arrangements that could limit market access for smaller operators.

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The latest proposal represents another major regulatory intervention by the NMDPRA since the implementation of the Petroleum Industry Act.

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In recent years, the Authority has introduced regulations covering environmental protection, operational safety, decommissioning of petroleum facilities and environmental remediation funding as part of efforts to strengthen governance across Nigeria’s petroleum value chain.

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The proposed competition regulations also come as the regulator continues to advocate a more transparent petroleum pricing regime. Recently, the NMDPRA disclosed that it was exploring the establishment of an African petroleum products reference price benchmark to reflect regional market realities and improve price transparency across the continent.

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If adopted after stakeholder consultations, the new regulations would provide the Authority with a comprehensive legal framework to investigate and sanction anti-competitive conduct in Nigeria’s midstream and downstream petroleum sectors, reinforcing the competition provisions introduced under the Petroleum Industry Act and promoting a more transparent, efficient and consumer-oriented fuel market.

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