Nigeria Inflation Set to Rise After March Spike as Oil Shocks and Supply Pressures Bite

Nigeria’s inflation is expected to keep rising in the coming months following a sharp increase recorded in March 2026, as analysts warn that both global shocks and domestic economic pressures are pushing prices higher across key sectors of the economy.

Data from the National Bureau of Statistics (NBS) showed that headline inflation climbed to 15.4% year-on-year in March, marking the first increase in 12 months. On a monthly basis, inflation surged even faster to 4.2% from 2.0% in February—the steepest monthly rise since records began in 2009, highlighting renewed pressure on household budgets.

According to analysts at Afrinvest West Africa, the spike was driven by a mix of global and local factors, especially rising crude oil prices triggered by geopolitical tensions in the Middle East. Oil prices jumped from below $80 per barrel to above $100 in late February, leading to higher fuel costs across Nigeria. This increase in petrol and diesel prices quickly filtered through transport, production, and distribution channels, pushing up the cost of goods and services nationwide.

The inflation breakdown showed broad-based increases. Food inflation rose to 14.3%, its fastest pace in six months, while core inflation climbed to 16.2%, reversing previous months of moderation. Although food prices slightly eased on a monthly basis, rising energy and logistics costs continued to drive overall inflation, with analysts warning that the worst may not yet be over. Afrinvest projects inflation could rise further to 16.4% in April, with food inflation potentially reaching 16% and core inflation rising to 17.8%.

Other market analysts, including Coronation Asset Management and Cordros Capital, also pointed to persistent risks such as foreign exchange pressures, high transport costs, and weak supply chains. To ease the burden on citizens, Afrinvest called for urgent government intervention, including affordable mass transit systems, expanded access to healthcare for low-income households, and the release of grains from strategic reserves to stabilise food prices. The firm also warned that climate risks, particularly flooding expected across more than 14,000 communities, could further worsen inflationary pressures in the coming months.

source: Leadership