N1,300/litre: Marketers, Filling Stations Maintain High Petrol Rates Despite Crude Oil Price Drop
- Despite a drop in global crude oil prices from $130 to $100 per barrel, petrol prices in Nigeria remain high
- Investigations reveal that stations in cities like Lagos and Abuja have not adjusted prices in response to global trends
- This has led to increased transportation fares and calls from industry experts for regulatory bodies to protect consumers from exploitation
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
Despite a notable decline in global crude oil prices, the price of petrol remains stubbornly high across Nigeria.
Crude oil prices have fallen from $130 per barrel to around $100 per barrel, yet consumers continue to face petrol prices that exceed N1,300 per litre.
Source: UGC
This price stagnation has raised questions about the reasons for the persistent high costs, particularly given that the global market is experiencing a decline in crude oil prices.
Oil price falls, but no petrol cost drop
The drop in crude oil prices can be attributed to the diplomatic negotiations between the US and Iran, which have raised hopes for the return of Iranian oil into Asian markets.
Despite these developments, investigations by Vanguard revealed that oil marketers in major cities like Lagos and Abuja have not adjusted their pump prices in response to the global changes.
In Lagos, petrol stations like MRS continue to sell petrol at N1,333 per litre, while depot prices remain marginally lower, with operators like Alkanes and Bovas selling at N1,270 per litre.
Similarly, in Abuja, stations like NIPCO and AYM Shafa maintain prices as high as N1,371 per litre, showing no signs of lowering prices despite the global crude oil price drop.
Impact on consumers and transport costs
This continued high petrol pricing has had a cascading effect on other sectors of the economy, particularly transport.
With petrol prices remaining high, transport operators have passed on the increased cost of fuel to commuters, resulting in fare hikes of up to 50%.
For instance, a journey from Ikorodu to Oshodi, which previously cost N800, now requires N1,200.
For many Nigerians, this has become an unbearable burden, particularly as inflation continues to rise, but salaries remain stagnant.
Regulators and stakeholders react to price increases
Various stakeholders have voiced concerns over the lack of regulation and the price stagnation in the petroleum sector.
Olatide Jeremiah, CEO of Petroleumprice.ng, called for stronger action by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Federal Competition and Consumer Protection Commission (FCCPC) to safeguard consumers from exploitation.
“The NMDPRA and the FCCPC, need to protect consumers from exploitation, as marketers are quick to increase prices but slow to reduce them, thereby making abnormal profits at the expense of Nigerians."
He highlighted the trend where marketers increase prices rapidly but are slow to adjust them downward, making excessive profits at the expense of Nigerians.
Source: UGC
On the other hand, Billy Gillis-Harry, president of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), defended the high prices, emphasising that the market should be left to function based on demand and supply.
Gillis-Harry said:
“This is a deregulated market, and the forces of demand and supply should be allowed to guide operations.”
Despite these discussions, depot owners have remained silent on the matter, leaving consumers and regulators to navigate the complexities of a deregulated market.
Oil price hike forcing people to work remotely
Meanwhile, Legit.ng earlier reported that Aliko Dangote warned that rising oil prices have encouraged working from home to cope with escalating energy costs.
He highlighted the significant strain this is placing on sectors like small businesses and industries reliant on generators.
Dangote urged a peaceful resolution to the conflict, as it could worsen financial hardships for citizens, particularly in Africa.
Source: Legit.ng
