The tanker was said to be carrying 45,000 litres of Premium Motor Spirit.
Officials of the Lagos State Emergency Management Agency (LASEMA) and the fire services are battling to put out the fire.
This comes after an NNPC filling station went up in flames at Ogba area of Lagos earlier in the week.
Director General, LASEMA, Dr. Femi Oke-Osanyintolu, said the agency received a distress call on the incident at Obalende.
He said the tanker exploded after falling on its side directly in front of the filling station.
“Effort to combat the flames by the agency’s officials and men of the Lagos State Fire Service and the Federal Fire Service is on going,” he said.
“The fire has been curtailed and very soon it will be extinguished. The station and surrounding buildings protected.
“We appeal for calm and urge members of the public to keep away and allow the responders to complete their work.”