NNPC Announces Second Petrol Price Cut in One Week, Motorists Rejoice
- NNPC has reduced the pump price of petrol in Abuja from N1,260 to N1,210 per litre, marking its second price cut within a week.
- The reduction follows Dangote Refinery's decision to lower its ex-depot petrol price to N1,125 per litre, increasing competition in the downstream market.
- The latest price cuts are linked to declining global crude oil prices and have raised expectations of further reductions in petrol prices across Nigeria.
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
The Nigerian National Petroleum Company Limited (NNPC Ltd.) has reduced the pump price of Premium Motor Spirit (PMS), commonly known as petrol, for the second time within a week, further intensifying the ongoing price competition in Nigeria's downstream petroleum sector.
A market survey conducted on Saturday showed that several NNPC retail stations in Abuja, including outlets around Airport Junction and Wuse Zone 6 (Berger), have lowered the pump price from N1,260 to N1,210 per litre, representing a reduction of N50 per litre.
Source: Getty Images
The latest adjustment follows an earlier N75 per litre reduction implemented just four days earlier, bringing the cumulative price cut by the state-owned oil company to N125 per litre within a week.
Dangote Refinery Competition Reshapes Market
NNPC's latest price review comes shortly after Dangote Petroleum Refinery announced a N50 per litre reduction in its ex-depot (gantry) price, bringing it down to N1,125 per litre.
The back-to-back reductions have reinforced competition in Nigeria's deregulated downstream market, where marketers are increasingly adjusting retail prices in response to changes in supply costs and pricing strategies by major suppliers.
As a result, petrol prices now vary across filling stations in Abuja and neighbouring areas, with consumers paying between N1,210 and N1,305 per litre, depending on the marketer and location. Industry observers say the increasing rivalry among suppliers is gradually giving motorists some relief after months of elevated fuel prices.
Falling Crude Oil Prices Support Lower Fuel Costs
The downward adjustment also reflects the recent decline in global crude oil prices.
International benchmark Brent crude has been trading around $71 per barrel, while West Texas Intermediate (WTI) has hovered near $69 per barrel, following easing geopolitical tensions in the Middle East and renewed optimism over global oil supply.
Since Nigeria fully deregulated the petrol market, domestic fuel prices have become more responsive to movements in international crude prices, foreign exchange rates, shipping costs and other market fundamentals.
Consequently, lower crude prices generally reduce the landing cost of imported petroleum products and improve pricing flexibility for locally refined fuel.
Analysts, however, note that fluctuations in the naira exchange rate remain a major factor influencing petrol prices, alongside logistics costs and marketers' operating expenses.
Source: Getty Images
Nigerians Expect Further Reductions
The latest price cuts have renewed calls from consumers and labour groups for further reductions in pump prices, arguing that the decline in international crude oil prices should continue to translate into lower fuel costs across the country.
Although President Bola Tinubu's administration has consistently defended the deregulation of the downstream petroleum sector, it has yet to officially comment on the recent wave of price reductions by NNPC and Dangote Refinery.
Market analysts believe the competitive pricing trend could persist in the coming weeks if crude oil prices remain stable, the naira avoids significant depreciation, and domestic fuel supply continues to improve.
They add that increased local refining capacity, led by the Dangote Refinery and the gradual rehabilitation of state-owned refineries, could further strengthen competition and help moderate petrol prices over time.
Source: Legit.ng
