Oil marketers have distanced themselves from the recent hike in the pump prices of Premium Motor Spirit (PMS), popularly called petrol, following the commodity’s price increase by the Dangote Petroleum Refinery and other depot owners.
Naijaonpoint reports that marketers have attributed the surge to the rising cost of crude oil in the international market.
Long queues resurfaced at filling stations in major cities, including Lagos, Abuja, and Port Harcourt on Saturday. Many outlets remained closed.
Depending on the location, petrol prices ranged between ₦1,050 and ₦1,150 per litre.
Price Hike At Dangote Refinery
On Friday, the Dangote Petroleum Refinery raised its petrol price from ₦899 to ₦955 per litre. Subsequently, retail stations adjusted their pump prices, and some shut their doors to monitor the market.
“There is no scarcity of the product; rather, filling stations are closed because dealers are observing developments and are careful not to run at a loss,” a major marketer, speaking anonymously with Punch, explained.
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) noted that international crude oil prices were influencing domestic petrol costs.
PETROAN President, Billy Gillis-Harry, highlighted that Brent crude was trading at $80.85 per barrel, while the OPEC basket stood at $81.72 per barrel.
He explained that the price surge resulted from new US sanctions on Russian oil, pushing global oil prices to a four-month high.
“The increasing crude oil prices will inevitably affect the domestic cost of PMS,” Gillis-Harry said.
Dealers Explain Pricing Dynamics
Gillis-Harry emphasized that petrol prices are now determined by market forces under the Petroleum Industry Act (PIA). “Our selling rate reflects our buying rate. Our members shouldn’t be blamed for the current increase; it’s an external factor,” he stated.
He urged the Federal Government to privatise refineries and foster competition in the downstream sector to stabilise prices.
“Privatising refineries will increase efficiency, reduce the government’s financial burden, and benefit Nigerian consumers,” he added.
PETROAN’s Recommendations
In a position paper presented at the inaugural Petroleum Industry Stakeholders’ Forum in Abuja, PETROAN recommended several strategies to stabilize the sector. These include:
– Privatisation of Refineries: To improve operational efficiency and reduce costs.
– Infrastructure Development: Addressing challenges in storage and distribution networks.
– Cross-Border Smuggling: Strengthening efforts to curb fuel smuggling to neighbouring countries.
– Monitoring Framework: Establishing robust systems to evaluate downstream operations.
– Crude Supply to Local Refineries: Prioritising access for domestic refining.
Call For Government Intervention
The marketers urged the government to create a conducive business environment by facilitating access to affordable financing and enhancing infrastructure.
“This will help reduce operational costs and make petrol more affordable for Nigerians,” Gillis-Harry noted.
The association commended President Bola Tinubu for fully deregulating the industry and unifying exchange rates, which they said had unlocked new opportunities in the petroleum sector.
“These policies are essential for fostering growth and sustainability in the industry,” Gillis-Harry remarked.