Nigeria Economic Update, Issue 18

The National Bureau of Statistics’ Transport Fare Watch for March 2026 revealed that transport costs in Nigeria increased significantly across major categories, reflecting persistent inflationary and energy-related pressures. Intra-city bus fares rose by 14.86 percent month on month to ₦1,373.49, while intercity transport fares increased by 17.95 percent to ₦9,564.12. Airfares also increased by 2.33 percent to ₦157,224.05, while motorcycle (Okada) and water transport fares rose by 9.05 percent and 4.59 percent respectively. On a year-on year basis, transport costs recorded substantial increases, particularly for Okada fares, which rose by 57.37 percent, and intra-city bus transport, which increased by 41.33 percent. Regional analysis indicated that the South-West recorded the highest fares for intra-city bus and motorcycle transport, while the South-South recorded the highest water transport fares. The sustained rise in transport fares was driven largely by elevated fuel and energy costs, exchange-rate pressures affecting vehicle maintenance and aviation operations, and broader inflationary conditions in the economy. Rising transportation costs continue to increase household expenditure, weaken purchasing power, and intensify cost-of-living pressures, particularly for low-income households. In addition, higher intercity transport fares may further worsen food inflation by increasing logistics and distribution costs across supply chains. To moderate transport-driven inflation, the government should strengthen investment in affordable public transportation, rehabilitate critical road infrastructure, and accelerate the adoption of alternative-energy transport systems, such as compressed natural gas (CNG)-powered buses. Sustained exchange rate stability and measures aimed at easing fuel price pressures will also be essential for reducing transportation costs and supporting broader price stability.

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