Nigeria’s annual average inflation is projected to decline significantly to 15.6 per cent in 2026 before easing further to 14.7 per cent in 2027, according to the latest economic assessment by the International Monetary Fund.

This expected slowdown marks a noticeable deceleration from the elevated 23.0 per cent average inflation recorded in 2025.

Economic analysts at Coronation Research highlight that key macro stabilisation measures are actively contributing to this cooling trend. Specifically, increased exchange rate stability alongside growing domestic refining capacity is playing a central role in moderating persistent domestic price pressures across supply chains.

Despite this encouraging downward trajectory, persistent risks could temper the speed of relief for businesses and consumers.

In its evaluation of the macroeconomic environment, Coronation Research noted, “Exchange rate stability and increased domestic refining capacity could help moderate price pressures. However, higher energy and fertiliser costs, alongside election-related spending, may slow the pace of disinflation”.

High input expenses and local food insecurity continue to present direct risks to overall household welfare, threatening to constrain how effectively macro disinflation translates into immediate improvements in daily living standards.

Looking ahead, the IMF projects Nigeria’s gross domestic product to grow by 4.2 per cent in 2026 and 4.3 per cent in 2027, driven by continued foreign exchange reforms and strong performance in the non-oil sector.

Analysts from Coronation Asset Management broadly backed these projections, pointing out that their internal estimate for 2027 annual average inflation sits very close to the multilateral lender’s forecast at 14.56 per cent. “While structural headwinds remain, the ongoing economic policy reforms and expanded refining operations provide a strong foundation for steady, long-term price moderation”, an analyst said.

In recent years, Nigeria has grappled with elevated price pressures, fuelled by macroeconomic imbalances, foreign exchange volatility, and external supply chain disruptions. Following a period of aggressive policy interventions, including foreign exchange market adjustments and structural economic reforms aimed at stimulating non-oil production, the focus has shifted toward restoring price stability and stabilising the local currency.

The latest October 2026 World Economic Outlook update by the International Monetary Fund and companion analyses from Coronation Research offer an updated projection on the country’s macroeconomic path.

After headline annual-average inflation climbed to an estimated 23.0 per cent in 2025, persistent tight monetary policy, combined with a gradually stabilising foreign exchange regime, has begun easing price pressures across major consumer categories.

“Increased local refining capacity has further aimed to reduce energy import dependency and temper transportation fuel costs. However, lingering supply risks, higher agricultural input costs, and fiscal pressures continue to pose potential risks to the broader disinflation trend”, the report added.

Source: punchng.com

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The Federal Government says it has settled more than N100bn in longstanding gas debts since January 2026 as part of efforts to strengthen the gas-to-power value chain.

The Special Adviser to the President on Oil and Gas, Mrs Olu Verheijen, disclosed this on Wednesday in her keynote address at the Africa Interviews Sustainability Forum 2026 in Lagos.

She said the settlement was carried out under the administration’s Presidential Power Sector Financial Reforms Programme.

The presidential adviser also highlighted measures introduced since 2023 to encourage the adoption of liquefied petroleum gas for household cooking.

She said the government had instituted import duty waivers and zero-rated value-added tax measures for LPG and gas cylinders to promote cleaner cooking alternatives and reduce dependence on firewood.

“A gas-rich nation cannot be comfortable while families remain stuck in the age of firewood,” she said.

Verheijen attributed progress in the gas sector to reforms under President Bola Tinubu’s administration aimed at removing investment barriers and unlocking Nigeria’s gas resources for industrialisation, electricity generation and economic growth.

She disclosed that Nigeria had recorded four final investment decisions in gas projects in less than two years, while average daily gas production had risen from about seven billion cubic feet to eight billion cubic feet.

Speaking on Nigeria’s gas potential, Verheijen said the country held more than 200 trillion cubic feet of proven reserves but stressed that resource abundance alone did not guarantee prosperity.

“A country can sit on enormous natural wealth and fail to turn it into energy to power industry, industries that create jobs and jobs that help us grow incomes.

“What turns resources into prosperity is investment, consistent investment that responds to predictable incentives and a stable environment,“ she noted.

The presidential aide maintained that Tinubu had given his administration a clear mandate to address the factors preventing investment from matching Nigeria’s economic potential.

“When President Bola Tinubu assumed office in 2023, he gave us a very clear mandate: understand why investment has not moved at the pace of Nigeria’s potential and fix it,” she said.

According to her, gas remained central to the administration’s reform agenda because of its importance to electricity generation, manufacturing, transportation, fertiliser production and cleaner cooking.

“Gas has been a priority within that reform agenda because Nigeria is, as you all know, even more gas-rich than it is oil-rich, and the gas is arguably the most important physical resource for industrialisation,” she added.

Verheijen disclosed that Nigeria had recorded four gas final investment decisions in less than two years, including the Ima project in September 2026. Indigenous producers, she added, were playing an increasingly significant role in the country’s gas supply.

Addressing Africa’s energy transition, Verheijen said the continent must prioritise energy security, industrial development and job creation while pursuing environmental sustainability.

“For Africa, the energy transition must mean transformation, molecules converted into megawatts, fertilizer, petrochemicals, cleaner mobility, manufacturing, jobs and exports,” she said.

She argued that African countries must retain the freedom to determine the pace of their energy transitions in line with their development priorities and economic circumstances.

“The energy transition must also mean agency. Africa is right to decide for itself how fast it decarbonises, rather than having those choices made for us by others. It is about affirming our right to be the authors of our own energy transition,” she said.

Verheijen also emphasised the need to measure and mitigate methane emissions and ensure that host communities benefited meaningfully from gas development.

Vice President Kashim Shettima on Wednesday urged state governments to end their dependence on the Federal Government for solutions to local power problems and to set up functional electricity markets under the Electricity Act 2023.

He spoke at the opening of the National Stakeholders’ Workshop on the Electricity Act 2023 at the State House Banquet Hall, Presidential Villa, Abuja.

The workshop, themed “Unlocking the Opportunities of the Electricity Act 2023 for Sustainable Energy Development and Economic Growth in Nigeria,” brought together federal and state institutions and regulators.

In a speech delivered on his behalf by the Deputy Chief of Staff to the President, Ibrahim Hadejia, on Wednesday, Shettima said Nigeria’s ambition of building a competitive industrial economy would remain constrained unless electricity reforms produced reliable power for businesses, households and public institutions.

He said the Act had created an opportunity to decentralise electricity governance and let states build power markets suited to their economies and resources.

“The Act empowers states to develop and regulate intrastate electricity markets within the applicable constitutional and statutory framework.

“The size, diversity and endowments of this nation demand this decentralisation.

“Electricity supply must become a shared responsibility, pursued with innovation and accountability across the federation. Our states must shed the habit of waiting for Abuja to provide every answer,” he said.

The Vice President cited solar potential in Sokoto, Borno and Katsina, gas resources in Delta, Rivers and Bayelsa, and hydroelectric opportunities in Niger and Kebbi, and urged states to turn them into investments that could power agriculture, manufacturing, healthcare and education.

He warned that a law alone would not improve supply, and told states that had yet to set up regulators to start without delay.

“Legislation cannot implement itself. States yet to act must begin their legislative and institutional preparations promptly.

“They need to establish functional electricity regulatory bodies with technical competence and capacity,” he said.

Shettima proposed a voluntary National Electricity Reform Peer Review and Implementation Framework, involving the Nigerian Electricity Regulatory Commission, the Federal Ministry of Power, the Nigeria Governors’ Forum and state regulators.

He said states would use it to share experience, strengthen their regulators and assess progress on market development, investment readiness, consumer protection and electricity access.

According to him, “No state needs to purchase with failure the knowledge another state has already acquired.”

Shettima said annual voluntary reviews should identify implementation problems, facilitate technical assistance and promote practical solutions without undermining the constitutional powers of states.

The Vice President said government could not finance the transformation from the treasury alone.

“Private capital must arrive with technology and expertise. Transparent licensing, predictable regulation, commercially viable markets, investment safeguards and credible dispute resolution will earn investors’ confidence,” he added.

He also called for stronger consumer protection against arbitrary billing, poor service and unfair commercial practices, and said operators must be held accountable for service quality.

The VP argued, “The final verdict on this law will be delivered wherever a Nigerian reaches for a switch.”

The Permanent Secretary of the Federal Ministry of Power, Mahmuda Mamman, who represented the Minister of Power, Joseph Tegbe, said the Act’s success would depend on states’ ability to build credible institutions and commercially viable markets.

The Director-General of the Nigeria Governors’ Forum, Dr Abdulateef Shittu, said work was under way on a standard tariff framework for states to protect consumers while attracting investment.

He urged stakeholders to ensure that any amendment to the legal framework was built on progress already made.

The Head of Compliance at the Electricity Commission, Hauwa Yakubu, said it had issued regulatory transfers to 17 states, the latest being Akwa Ibom.

She noted that the commission was supporting new state regulators through peer-to-peer training and technical engagement.

President Bola Tinubu signed the Electricity Act 2023 in June 2023, replacing the Electricity Power Sector Reform Act of 2005.

It allows states to license generation, transmission and distribution within their borders, while the national regulator keeps oversight of interstate matters.

Lagos, Edo and Kaduna already had state electricity laws when it was signed.

The commission’s order moving Akwa Ibom’s intrastate regulation to the state regulator, AKSERC, was dated August 18, 2026.

At the time, it mandated that transfers be completed by February 17, 2027, and that the commission had reported 16 states fully transitioned in July.

Generation companies said in March that they were owed about N6.8tn at the end of February and that national output had hovered around 4,000 megawatts for years, against installed capacity of about 14,000 megawatts.

Source: punchng.com

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