PENGASSAN Makes Predictions On Price Of Petrol

The National President of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), Festus Osifo, has warned that the price of Premium Motor Spirit (PMS) may increase soon if crude oil prices continue to climb.

Osifo issued this warning during PENGASSAN’s National Executive Council meeting held on Thursday in Lagos. He attributed the potential hike to rising crude oil prices and the impact of the exchange rate.

“The crude price rose to $80 per barrel today. Without exchange rate improvements, PMS prices will increase in the coming weeks,” Osifo said.

He pointed out that the weakening naira significantly contributes to the high cost of PMS, adding that even with the operations of domestic refineries, the exchange rate remains a critical factor.

Naijaonpoint reports that Osifo also addressed misconceptions about local refining, highlighting the complexity of producing quality PMS.

“The old Port Harcourt refinery is functional, and there is significant progress at the Kaduna and Port Harcourt refineries. Refineries globally engage in blending operations; it is a normal part of the process,” he stated.

He explained that local refining alone would not drastically lower PMS prices as production costs, including refining and distribution, must still be accounted for.

“Producing locally does not mean selling below cost. Even farmers calculate their production costs before adding margins,” Osifo emphasised.

Osifo underscored the link between fuel prices and currency management, stating, “The price of PMS is directly linked to our weak naira. If the exchange rate improves to below ₦1,000 to a dollar, PMS could sell for ₦500–₦600 per litre.”

He compared Nigeria to countries like Venezuela and Zimbabwe, noting that oil and gas transactions are conducted in U.S. dollars, which exacerbates costs in countries with weak currencies.

Osifo also criticised Nigeria’s 2025 budget of ₦49 trillion (approximately $30 billion), describing it as grossly inadequate for a nation of over 230 million people.

“The budget of $30bn is abysmally low for a country like Nigeria, especially when you compare it with nations like South Africa, which has a population of about 60 million but operates on a budget of over $120bn,” he said.

He called for urgent measures to harness Nigeria’s abundant natural and mineral resources to expand its revenue base and reduce reliance on loans.