Keeping petrol affordable at the pump is proving far costlier than Niger’s government bargained for. New projections from the International Monetary Fund sketch a worrying outlook for the national oil company, SONIDEP, which is on course to close the 2026 financial year with a net loss of 28 billion FCFA — the combined result of runaway domestic demand and expensive purchases on world markets.

How Nigeria’s subsidy removal rebounded on Niger

The origins of this financial strain lie outside Niger’s own borders. After Nigerian President Bola Tinubu scrapped petrol subsidies, a sizeable share of regional demand flowed toward Niger, where the state keeps prices artificially low. That price gap turned Nigerien fuel into a far more attractive option than what is sold just across the frontier, fuelling both higher local consumption and heavier cross-border traffic.

Zinder refinery capped while imports are bought at full price

Faced with this influx, the Zinder refinery, whose output is limited by its installed capacity, could not supply the entire national market on its own. To stave off shortages, SONIDEP had to fall back on large-scale imports — fuel purchased at international rates and then resold inside the country at a loss.

The subsidy invoice reaches 42 billion FCFA

Holding pump prices steady and protecting household purchasing power carries an estimated total subsidy bill of 42 billion FCFA for 2026. The financing plan designed to settle that invoice directly weakens the state operator:

Where the money will be taken from

• 15 billion FCFA will be drawn from SONIDEP’s price stabilisation mechanism and fund, emptying the company’s precautionary reserves.
• The remaining 28 billion FCFA will close the year as a direct net loss booked in the state firm’s accounts.

A dividend that disappears from the public treasury

The consequences of this trade-off stretch well beyond SONIDEP’s balance sheet. The government had initially counted on 3.3 billion FCFA in dividends tied to the public company’s performance, but the revised projections bring that direct fiscal revenue down to nothing.

A price shield with an uncertain lifespan

By allowing SONIDEP to swallow the oil shock rather than adjusting pump prices or tightly controlling cross-border flows, the authorities are securing social calm in the short term. The price of that choice, however, is the financial staying power of the country’s leading fuel distributor, now obliged to give up its profitability and its equity to serve as a tariff buffer.

By Maimouna Kaboré — Editor-in-Chief