The Centre for the Promotion of Private Enterprise (CPPE) has warned that rising energy costs could reverse Nigeria’s current disinflation gains, regardless of headline inflation easing to 14.63% in September 2026.
The coverage assume tank stated the sharp acceleration in month-to-month energy inflation poses a menace to the broader decline in shopper costs, calling for measures to strengthen home energy resilience and scale back manufacturing and distribution costs.
The warning was contained in a CPPE’s coverage temporary on Nigeria’s September 2026 inflation report launched by the National Bureau of Statistics (NBS).
According to the organisation, month-to-month energy inflation accelerated to five.38% in September from 0.36% in August, a rise of 5.02 proportion factors, whereas year-on-year energy inflation stood at 10.85%.
Energy costs threaten inflation outlook
The CPPE described the acceleration in month-to-month energy inflation as one of the crucial vital warning indicators within the September inflation report, noting that energy is a crucial enter throughout virtually each sector of the economic system.
Higher petrol, diesel and fuel costs improve transportation, distribution and manufacturing costs, with potential knock-on results on meals costs and core inflation.
The organisation linked the stress to geopolitical tensions within the Middle East, which have heightened volatility in world petroleum markets and uncovered Nigeria to exterior energy-price shocks.
While alternate price stability might help average imported inflation, the CPPE stated it can’t totally offset rising worldwide energy costs.
It warned that sustained will increase in energy costs could undermine the current disinflationary development, arguing that lasting worth stability would require decreasing the economic system’s structural dependence on costly and risky energy sources.
- “The policy priority should therefore be to strengthen domestic energy resilience through reliable electricity supply, expansion of CNG infrastructure, greater adoption of electric mobility and improved domestic refining efficiency,” the temporary stated.
Headline inflation falls to 14.63%
The CPPE welcomed the decline in headline inflation to 14.63% in September from 15.39% in August, representing a lower of 0.76 proportion factors, or 76 foundation factors.
It stated the moderation reinforces the disinflationary development, helps macroeconomic stability and improves prospects for funding, financial easing and financial restoration.
- Core inflation additionally eased to 12.95% from 13.29%, whereas month-to-month headline inflation declined to 0.06% from 0.71%.
- Monthly meals inflation turned adverse at 1.55%, providing some quick reduction to shoppers, based on the organisation.
- The CPPE attributed a part of the development to relative stability within the international alternate market, which has helped average imported inflation and enhance enterprise planning.
However, it cautioned that falling inflation doesn’t essentially imply that the general value of doing enterprise is declining, notably when energy and logistics costs stay elevated.
CPPE backs additional rate of interest cuts
The organisation stated moderating inflation strengthens the case for additional financial easing, given the excessive value of credit score dealing with companies throughout the economic system.
It famous that elevated borrowing costs have constrained manufacturing, agriculture, development, distributive commerce and micro, small and medium-sized enterprises (MSMEs).
It urged policymakers to keep up a measured strategy, balancing the necessity to scale back borrowing costs in opposition to inflation expectations, alternate price circumstances and rising energy-price dangers.
The organisation additionally flagged the rise in month-to-month core inflation to 1.11% in September from adverse 0.06% in August, regardless of the decline in annual core inflation.
It stated the divergence means that underlying worth pressures haven’t been totally contained.
CPPE outlines coverage priorities
To maintain the disinflationary development and restrict the danger posed by energy costs, the CPPE advisable a number of measures for policymakers.
These embrace sustaining prudent financial easing whereas safeguarding international alternate stability and inflation expectations, and prioritising meals affordability by addressing insecurity, agricultural productiveness constraints, post-harvest losses and distribution costs.
It additionally referred to as for accelerated electricity-sector reforms, expanded compressed pure fuel and different energy infrastructure, and extra aggressive home petroleum markets to scale back energy costs.
Energy inflation in 2026
The year began with energy inflation at 11.17% in January earlier than accelerating to 12.90% in February, its highest degree within the first 9 months of 2026.
- The price subsequently moderated to 9.90% in March and declined additional to 4.60% in April, earlier than recovering barely to five.73% in May.
- Energy inflation climbed once more to 9.90% in June however fell to 4.40% in July, its lowest studying in the course of the interval.
August recorded a marginal improve to 4.69%, earlier than the speed greater than doubled to 10.85% in September, marking the sharpest month-to-month acceleration within the annual inflation price up to now this 12 months.
