“N860/Dollar”: Petrol Marketers Say Recent Government Policy, Naira Devaluation For Hike in Prices

“N860/Dollar”: Petrol Marketers Say Recent Government Policy, Naira Devaluation For Hike in Prices

  • Petrol marketers have revealed how was added to the current hike in prices of petrol
  • The Chairman of Major Oil Marketers, Olumide Adeosun, said the naira devaluation increased the cost of importation of products
  • He told members of the association incurred additional costs of N100 per liter via imports and other dues

Petrol Marketers have blamed the devaluation of the naira for the recent hike in prices of petrol.

According to the Chairman of the Major Oil Marketers Association of Nigeria (MOMAN), Olumide Adeosun, the international price of crude oil and the exchange rate constitutes large parts of the cost build-up for petrol prices, which accounts for over 80%.

MOMAN, petrol prices, foreign exchange
Petrol marketers disclose why they added N100 to a litre
Credit: NurPhoto/Contributor
Source: Getty Images

MOMAN advocates for palliatives for poor Nigerians

Adeosun disclosed this at a workshop on Wednesday, July 19, 2023, adding that about 20% of the cost incurred by marketers included statutory dues, distribution costs, and margins.

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The association responded as the Nigeria National Petroleum Company Limited (NNPC) hiked the petrol price to N614 per liter on Tuesday, July 18, 2023.

Punch reports that Adeosun said that deregulation provides a transparent and level-playing ground where cost-reflective prices are shown at fuel stations.

Adeosun said:

“In a liberalized market, the pump price of PMS should accurately reflect the current economic realities,” he noted.

“As of today, the liquid exchange rate is close to N825 to the dollar. This devaluation adds N100 to the cost of importing a single liter of PMS into the country. Consequently, an increase in the pump prices of petrol should be expected,” he further explained.

Per the MOMAN boss, the association asked for the three arms of government and the private sector to introduce measures to reduce the impact of subsidy removal.

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He said the removal of subsidy allows marketers, NNPC, other regulators to earn public trust and drive fair competition, ensuring complete value for customers at fuel pumps.

He revealed that some markers have brought fuel into Nigeria, which is the first step in a deregulated market and said there are challenges ahead such access to Forex and fairness at petrol stations.

“If marketers are undertaking the financial risk of importing petrol, measures must be in place, in line with the Petroleum Industry Act, to ensure that no one player has an unfair advantage,” he added.

NNPC, Dangote speak on refinery production commencement date as Nigerians battle high petrol prices

Legit.ng reported that as Nigerians battle the high cost of petroleum products, especially petrol, they anxiously await the much-touted 650-capacity refinery belonging to billionaire businessman Aliko Dangote.

Dangote promised that the refinery, commissioned on May 22, 2023, by former President Muhammadu Buhari, would commence production at the end of July or early August.

With a few days to the end of July, hopes seem to decline as struggling Nigerians ask what is next for the much-hyped Africa’s biggest refinery.

Source: Legit.ng


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