Lagos, Nigeria – Despite the Nigerian National Petroleum Company (NNPC)’s efforts to maintain a stable pump price between N568 and N617 per litre, independent oil marketers have significantly raised petrol prices, with some stations now charging as much as N900 to N1,000 per litre. This development has prompted the Federal Government to threaten strict penalties, including the closure of offending stations, accusing them of profiteering and exploiting Nigerians.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has pointed fingers at private depot owners, alleging that they are selling petrol to independent marketers at exorbitant prices, leading to the sharp increase in pump prices across the country.
George Ene-Ita, spokesperson for the NMDPRA, highlighted discrepancies in petrol price reports received from various depots. “Our depot people see a different price because we ask them to publish the prices at the depots every day, and it is not N850/litre. Our field agents at the depots give us a different figure,” Ene-Ita explained.
He emphasized that the NMDPRA is prepared to take decisive action against any filling stations found selling petrol above the approved price. “We will shut down any filling station found selling above the approved price if we catch them,” he warned. Ene-Ita also noted that the NNPC sets the ex-depot price for off-takers, and the regulator collaborates with the company to establish reasonable margins, leaving no justification for such high prices.
However, independent marketers have countered these claims, arguing that they are compelled to sell at higher prices due to the limited supply from NNPC. They claim that the subsidized rate of around N570 per litre is only available to major marketers, forcing them to purchase petrol at inflated prices. Consequently, they are selling to consumers at rates ranging from N850 to N1,000 per litre, particularly in remote areas.
A source within the industry highlighted the challenges faced by independent marketers, noting that “the price is high because the supply is low. It is a matter of demand and supply. The price will continue to be up, at least for now. This is an abnormal situation.”
The source further elaborated on the financial pressures facing marketers, stating, “Imagine when you pay about N30 million to NNPC to order petrol, and it takes about one month to get the product. Assuming you take N30 million from a bank with this interest rate, is that not a problem?”
The situation has raised concerns about the sustainability of current pricing and the effectiveness of regulatory oversight, as the Federal Government seeks to balance market forces with the need to protect consumers from price gouging.
