Nigeria’s energy inflation rate fell sharply to 4.37% in July 2026, its lowest level in four months, according to the latest Consumer Price Index (CPI) data released by the National Bureau of Statistics (NBS).
The July figure represents a 5.46 percentage-point decline from the 9.83% recorded in June, continuing the volatile movement in energy-related prices recorded during the first seven months of the year.
NBS data showed that energy inflation stood at 11.20% in January before rising to 12.57% in February.
The rate subsequently declined to 9.89% in March and fell further to 4.50% in April before rising to 5.73% in May and 9.83% in June.
However, energy inflation moderated significantly in July to 4.37%, making it the lowest rate recorded since April, when it stood at 4.50%.
The latest data also show that energy inflation has remained below 10% in four of the first seven months of 2026, although energy costs continue to influence household and business spending.
Despite the moderation in the official inflation rate, energy costs remain a major factor in how Nigerians perceive inflation and its impact on their finances.
The latest Central Bank of Nigeria survey showed that households and businesses expect inflation-related spending pressures to ease over the next six months. However, energy costs remained the biggest driver of inflation perceptions among both groups.
The survey showed that 60.9% of firms reported an increase in expenditure due to inflation in July, while 55.9% of households reported a similar increase.
Energy costs, including Premium Motor Spirit (PMS), diesel and electricity, recorded the highest inflation perception score among firms at 74.1 points.
Among households, energy costs also recorded the highest perception score at 61.9 points.
The figures suggest that the moderation in energy inflation has not yet eliminated the broader impact of energy costs on household and business finances.
The movement in energy prices comes amid ongoing changes in Nigeria’s downstream petroleum market.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has proposed regulations that would prohibit petroleum companies from coordinating fuel prices, restricting supply or engaging in market-sharing arrangements that distort competition across the midstream and downstream oil and gas sector.
The proposed regulations followed renewed allegations of coordinated fuel pricing in Nigeria’s downstream petroleum market.
Meanwhile, Dangote Refinery cut the ex-depot price of Premium Motor Spirit to N1,075 per litre on July 2, following a decline in global crude oil prices.
However, developments in the international oil market continue to create uncertainty for domestic energy prices, particularly amid renewed tensions involving the United States and Iran, which have pushed crude oil prices higher.
The moderation in energy inflation comes as Nigerian households continue to contend with elevated living costs and borrowing rates.
Higher household expenses and borrowing costs have increasingly led Nigerians to postpone major purchases, including cars, homes and household appliances.
The July energy inflation figure therefore provides some relief but does not necessarily signal an end to the pressure energy costs place on households and businesses.
Energy prices remain closely linked to transportation, production and household expenditure. As a result, changes in PMS, diesel and electricity prices could continue to influence overall inflation expectations and the cost of living in Nigeria.
