Will Petrol Price Increase To N151.87 Per Litre?

The Nigerian National Petroleum Corporation (NNPC) has assured Nigerians that it has no plans to increase fuel price.

Maikanti Baru, the managing director NNPC gave the assurance in an interview with State House correspondents on Tuesday, August 9, after meeting with President Muhammadu Buhari.

Critics think price of petrol may increase to N151.87 per litre as petrol marketers reveal that price of the commodity at ex-depot is N133.28 per litre.

The marketers also revealed that price of the product will increase due to the continued scarcity of the United States dollar.

An oil marketer who spoke with Punch newspaper said; “Since the ex-depot price is around N133.5 per litre and the selling price is N145 litre, when you remove the ex-depot cost from the selling price, you’ll get about N12. Now, from this N12, consider the distribution margin and other costs from the depot; if all these costs are less than N12, then the marketers are making profits and there will be no complaint.

“But if the reverse is the case, then they have a complaint. I want you to find out what is the marketers’ margin, transporters’ margin, bridging fund, Petroleum Equalisation Fund, administrative charges and more. When you add all these together, you will realise that truly, the marketers are doing all they can to hold the pump price at the N145 per litre band.”

Checks by the newspaper with the PPPRA revealed that the marketer’s claim was true as the distribution margin for every litre of petrol consumed across the country, retailers charge N6; transporters’ allowance is N3.36; bridging fund, N6.2; dealers’ charge, N2.36; marine transport average, N0.15; and admin charge, N0.3; making a total of N18.71.

By adding this to the N133.5 ex-depot price, the final figure is N151.87.

The paper gathered from a source who was at the meeting between government officials and the marketers that the government might either subsidise the product again or consider some form of concession to the marketers with respect to the cost of the dollar.

“The issue of forex has been a challenge to both the government and the oil marketers. All of a sudden, the dollar skyrocketed to about N400 and the product we are concerned with here is an international product. So, if they are bringing in the product by buying dollar at N350, then it is obvious that they are really working hard to remain in business.

“For if we are in a truly deregulated market environment, then the price of the product should have increased beyond N145 per litre; there is no doubt about that. Meanwhile, there was a highly confidential meeting between the management of the PPPRA and stakeholders in the sector on this matter.

“I may not be able to tell you the resolutions that were reached concerning the issue of pricing of petroleum products, but the body language of those who participated in the meeting suggests that the government may be considering some form of concessions to the oil marketers as it did for the Muslim pilgrims. We all know that the government cannot afford to increase petrol price again, not at this time,” the official was quoted.