· Crude oil crashes further to $27pb
There are indications that reduction of the pump price of Premium Motor Spirit (PMS) aka petrol has resulted in confusion in the downstream segment, following failure by the Federal government to fix the price.
The Minister of State for Petroleum Resources, Mr. Timipre Sylva, had on Wednesday, directed the Nigerian National Petroleum Corporation (NNPC) to reduce the Ex-Coastal and Ex-depot prices to reflect the current market realities.
According to him, “the drop in crude oil prices has lowered the expected open market price of imported petrol below the official pump price of N145 per litre. Therefore, President Muhammadu Buhari has approved that Nigerians benefit from the reduction in the price of petrol which is a direct effect t of the crash in global crude oil prices.
“In view of this situation, based on the price modulation template approved in 2015, the federal government is directing the NNPC to reduce the ex-coastal and ex-depot prices of petrol to reflect the current market realities.
Also, PPPRA (Petroleum Products Pricing Regulatory Agency) shall subsequently issue a monthly guide to NNPC and marketer on the appropriate pricing template.
“The agency is further directed to modulate pricing in accordance with prevailing market dynamics and respond appropriately to any further oil market development. It is believed that this measure will have a salutary effect on the economy, provide relief to Nigerians and would provide a framework for sustainable supply of PMS to our country.”
Although the minister did not specify whether it is deregulating the entire downstream industry or not, industry stakeholders said the directive to the PPPRA to issue a monthly guide on appropriate pricing template means the industry has now been deregulated fully.
The Chairman of Major Oil Marketers Association of Nigeria (MOMAN), Mr. Tunji Oyebanji, was quoted as saying that MOMAN is in support of the Federal government’s policy that will give succor to Nigerians, and will do everything to see that the policy succeeds.
He said: “We are in support of federal government’s policy that will provide succor to Nigerians especially during these hard times of coronavirus pandemic and declining crude oil prices. We will do everything to see that the government succeeds.
“However, we are waiting for the directives by the federal government on the pump price of petrol. We are also hoping that such policy initiatives will include actions that will lead to long term sustainability of the downstream and make it more resilient and grow in the future.”
When asked if the market has been deregulated, he stated that “we are waiting for the directive from the government. I heard it just like you heard it today (Wednesday). You will agree with me that some trucks just loaded today, some are already on their way outside Lagos.
So, when we see the directive from the government, it will state the details because there will definitely be some reconciliation to be made and how much it will be sold.”
“However, we are waiting for the directives by the federal government on the pump price of petrol. We are also hoping that such policy initiatives will include actions that will lead to long term sustainability of the downstream and make it more resilient and grow in the future.”
When asked if the market has been deregulated, he stated that “we are waiting for the directive from the government. I heard it just like you heard it today (Wednesday). You will agree with me that some trucks just loaded today, some are already on their way outside Lagos.
So, when we see the directive from the government, it will state the details because there will definitely be some reconciliation to be made and how much it will be sold.”
- Media Report