BREAKING: Nigerians To Buy Fuel At N700/Litre From July

Oil marketers have projected that the pump price of petrol could rise above N700 per litre in Northern Nigeria starting from July.

VerseNews Nigeria reports that the National Controller Operations, Independent Petroleum Marketers Association of Nigeria, Mike Osatuyi, told ‘The PUNCH’ on Wednesday that prices could rise to above N700 in the north once independent marketers start importing products from July.

He said while those living in the northern states could pay as much as N700 and above for one litre of petrol, those outside Lagos should expect to pay around N610, as residents in Lagos would pay about N600 per litre.

“What I am seeing is around N600 and above, depending on the exchange rate, the current crude price at the international market and the landing cost. Those in Lagos will pay around N600, those outside Lagos around N600 plus, while those in the north would be paying anything from N700 and above,” he said.

The downstream sector currently awaits fresh petroleum products as the Nigerian Midstream and Downstream Petroleum Regulatory Authority continue to licence operators willing to get involved in the importation business.

The Executive Secretary, of the Depot and Petroleum Products Marketers Association of Nigeria, Olufemi Adewole, told The PUNCH on Tuesday that the NMDPRA was currently licensing more importers.

He said arrangements were on full speed for fresh products from July, adding that prices of products would depend on market fundamentals.

“Where do countries like Ghana, Benin, and Cameroun get their products from? Is it not from Nigeria?,” he asked, referring to products being smuggled from Nigeria to neighbouring countries.

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“Prices of products will depend on market fundamentals, and as we speak, the Nigeria Customs Service is delaying some AGO (diesel) vessels because of the 7.5 per cent VAT.

“And don’t forget, any cost incurred by marketers would be added to landing cost, and then to the pump price. The marketer would also have to add profit because they must make a profit,” he said.

A former chairman of the Major Oil Marketers Association of Nigeria, and Chief Executive Officer/Chairman of 11 Plc, Tunji Oyebanji, during a chat on Monday, said consumers should expect new pump prices close to that of diesel, and those of neighbouring African countries that also import petrol.

Checks by The PUNCH showed that as of June 19, the price of one litre of petrol in Ghana, Cameroun, and Benin was already above N800 per litre.

Petrol currently sells for around N495 and above in Nigeria, with diesel prices approaching N800 per litre.

“The truth now is that if you look at the prices of other West African countries that also import petrol, then, you will have an idea of what the price will likely be once companies start importing. So, if the price we have now is not anywhere close to theirs, then, we are not yet there. Another indicator should be the current price of diesel,” he said.

Oyebanji, however, added that the price could also be reduced depending on the exchange rate.

“The bottom line is that there will be a price adjustment. Yes, it may go up now, it could also drop depending on the exchange rate. But the good thing is that products would be everywhere, and if you see that yours is more expensive than those of the filling stations around you, you will be forced to bring down prices so customers can come and buy. There would be healthy competition which is good for the market,” he said.

Following the Federal Government’s official statement on the deregulation of the downstream market on May 29, prices of petrol have since shot up above N490/litre at stations belonging to the Major Oil Marketers Association of Nigeria, and above N500 at IPMAN stations across the country.

Chairman, IPMAN Satellite Depot, told The PUNCH that marketers were still loading products at the government-regulated price of N496 per litre.

“There are currently products in the country and we are loading at a government price of N496.50 per litre. But because of the new forex policy of the central bank, the naira has shot up to around N765/$1. Until new products start coming in, we won’t know the exact extent to which the new policy would affect our business,” he said.

Oyebanji also hinted that depot owners are now resorting to both local and foreign loans to finance importation.

“It’s not like we are just getting importation licenses. We have been licensed but we stopped importing because it was no longer profitable.

“Now, everybody is trying to see what we can do. Some people will raise money and borrow from abroad, while others will borrow from local banks. It’s not just three companies that would be importing; many companies are currently running around to start bringing in products. But we won’t be shouting about it on the pages of newspapers,” he said.