The group chief executive officer of the Nigerian National Petroleum Company (NNPC) Limited, Mele Kyari has attributed the recent surge in petrol pump prices, which has risen from N540 to N617 per litre, to prevailing market forces.
POLITICS NIGERIA reports that while addressing state house correspondents on Tuesday, following a meeting with Vice President Kashim Shettima at the Aso Rock Villa, Kyari clarified that the upward price adjustment is not a result of insufficient petrol supply.
“They are just prices depending on the market realities. This is the meaning of making sure that the market regulates itself. Prices will go up and sometimes they will come down also.”
“… there is no supply issue. It is not a supply issue.
“When you go to the market, you buy the product, you come to the market and sell it at its prevailing market price. It has nothing to do with supply. We don’t have supply issues.
“We have a robust supply. We’ve had over 32 days of supply in the country. That’s not a problem,” he explained.
Farouk Ahmed, CEO of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, also shed light on the recent increase in petrol prices, pointing to the rise in global crude oil prices as a significant factor.
Ahmed highlighted the impact of fluctuating freight costs and various miscellaneous expenses faced by importers during the distribution process, which collectively contribute to changes in prices.
He said, “Basically, what we’re seeing is the effect of market forces. You can see that crude oil prices have been on the rise. Just a week ago, crude oil prices hovered around $70 per barrel, but now it’s surpassed $80 per barrel. So naturally, these prices also influence the cost of the product.”
The Nigerian National Petroleum Company Limited (NNPCL) increased the pump price of petrol, known as Premium Motor Spirit (PMS), from N537 to N617 per litre this morning.
This is the second in less than two months.
In May, a day after President Bola Tinubu was sworn into office, the NNPC increased the fuel price from N195 per litre to N537 per litre.
These increases follow the Tinubu-led federal government’s removal of fuel subsidy.
This newspaper learnt that the increase has been observed at NNPC filling stations in Abuja, with other stations to join in soon.
In the first half of 2023, Nigeria spent N3.6 trillion on fuel subsidy alone. According to the Federal Government, the country will save close to N6.7 trillion if fuel subsidies payment is discontinued.
Nigeria has spent N13.7 trillion on fuel subsidy in the last 13 years, according to Nigeria Extractive Industries Transparency Initiative.
