Nigerian Analysts Warn of Imminent Inflation Rebound as Surging Energy and Food Costs Threaten Disinflationary Gains

Analysts warn Nigeria's inflation may rise past 15% due to high energy and food costs. Read the LCCI's urgent call for FX stability and agricultural security.

By: AXL Media

Published: Mar 18, 2026, 5:29 AM EDT

Source: The information in this article was sourced from LEADERSHIP

Marginal Gains Mask Growing Month on Month Price Momentum

The National Bureau of Statistics recently reported a subtle moderation in year on year inflation, marking the lowest level recorded since late 2021. However, this downward trend is facing immediate jeopardy as month on month figures showed a sharp rebound to 2.01 per cent in February. This acceleration suggests that the underlying drivers of the cost of living remain potent, despite a nearly year long streak of marginal declines. Financial experts note that the relief felt by consumers is largely cosmetic, as the momentum of price increases appears to be shifting back into a higher gear.

Agricultural Vulnerabilities and Seasonal Shortages Drive Food Inflation

A primary concern for the Nigerian economy is the sudden jump in food inflation, which climbed significantly to 12.12 per cent year on year. The month on month data is even more concerning, showing a 4.69 per cent acceleration following a brief contraction in January. Dr. Chinyere Almona, the Director General of the Lagos Chamber of Commerce and Industry, emphasized that insecurity in farming regions and climate related disruptions are severely challenging the food supply chain. Without a stabilized agricultural sector, the cost of basic staples is projected to rise as the country enters the peak planting season.

Energy Costs and Global Oil Spikes Impact Local Logistics

Rising energy prices are cited as a critical threat to domestic price stability, with analysts from Cordros Capital projecting a significant month on month inflation jump in March. The primary drivers are the surging costs of petrol and diesel, which have a direct pass through effect on transportation and operational expenses for manufacturers. Quest Merchant Bank further noted that geopolitical tensions in the Middle East have pushed global crude prices higher, a development that translates into more expensive fuel for local logistics providers and industrial producers who rely on independent power generation.