Nigeria's President Goodluck Jonathan has announced an immediate drop in the cost of fuel, following a week of strikes after prices doubled.
Mr Jonathan said the price would fall by around 30% in recognition of the "hardships being suffered" by people.
Nigeria has been paralysed by strikes and protests over the government's decision to scrap fuel subsidies.
Security forces fired into the air on Monday to disperse demonstrators in the commercial capital Lagos.
Hundreds of people turned out to protest, despite the unions saying they would urge members to stay at home because of security concerns.
Mr Jonathan has admitted there has been a near breakdown in law and order in parts of the country as a result of the strike.
Army checkpoints have been seen in parts of the commercial capital, Lagos, for the first time since the protests began, the BBC's Mark Lobel reports from the city.
Mr Jonathan, said in a televised address, the government would "continue to pursue full deregulation of the downstream petroleum sector".
"However," he added, "given the hardships being suffered by Nigerians, and after due consideration and consultations with state governors and the leadership of the National Assembly, government has approved the reduction of the pump price of petrol to 97 naira (about $0.60) per litre."
The price of petrol had risen from 65 naira ($0.40; £0.26) to 140 naira per litre when the subsidy was removed on 1 January.
The unions have not responded to the announcement but one leading activist has firmly rejected it.
"The broadcast by the president was not encouraging, not inspiring and it does not change anything," Alhaji Balarabe Musa, a former Kaduna state governor who has played a leading role in organising protests, told the BBC's Network Africa programme.
He demanded a return to the old price.
Mr Jonathan's speech came after a weekend of talks with the unions failed to prevent the strike from continuing into a second week.
Abdulwaheed Omar, president of the Nigeria Labour Congress union, said he would urge his members to "stay off the streets... because of the security situation" but stressed the nationwide strike would continue.
Oil workers had said they would cut production in Africa's biggest producer starting from Sunday, but it is not clear if this threat was carried out, as some strikes were called off over the weekend to allow for more talks.
The protests over five days last week led to the deaths of several people. Some 600 people were wounded, according to the International Red Cross.
The removal of fuel subsidies - long pushed for by the IMF - was a devastating blow to the large number of Nigerians who live in absolute poverty, correspondents say.
The authorities say the subsidy was costing the equivalent of more than $8bn a year, arguing that the money would be better spent on infrastructure and social services.
However, correspondents say many Nigerians feel the money is more likely to end up in the pockets of corrupt officials.
Oil accounts for some 80% of Nigeria's state revenues but after years of corruption and mismanagement, it has hardly any capacity to refine crude oil into fuel, which has to be imported.
The subsidy meant fuel was much cheaper in Nigeria than neighbouring countries, so large amounts ended up being smuggled abroad.
The government also argues that the biggest beneficiaries of the subsidy were the owners of fuel-importing companies - among the richest people in the country.
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