The paradox of Nigeria’s petroleum product unavailability and unaffordability despite vast crude oil reserves is a painful normal.There are structural, legal, and institutional factors underpinning this persistent challenge. Including inadequate local refining capacity, overdependence on fuel importation, dysfunctional subsidy and pricing regimes, foreign exchange constraints, insecurity in oilproducing regions, and regulatory bottlenecks which have perpetuated vulnerability to global price shocks and domestic supply disruptions. The paper examinedthe fiscal and economic implications of sustained import dependence which has lasted for decades, including the diversion of public resources from essential sectors to finance unsustainable subsidies. Drawing from the Petroleum Industry Act (PIA) 2021 and global best practices in oilrich jurisdictions such as Saudi Arabia, Angola, and South Africa, the paper found that there are critical gaps in Nigeria’s legal and policy framework that hinder private sector participation and public-private partnerships (PPPs) in refining development. It concluded that only targeted legal reforms could strengthen investment incentives, streamline licensing processes, enforce market access guarantees, integrate environmental and social safeguards, and reconfigure subsidies toward infrastructure development rather than consumption. The paper recommended strategic legal tools such as Build-Operatesustainable local refining capacity. The paper further recommended a coherent, investorfriendly, and socially responsible legal framework for repositioning Nigeria’s petroleum sector to ensure energy security, price stability, and long-term economic transformation, while simultaneously protecting environmental integrity and community welfare in oil-producing regions