••• NMDPRA SAYS PRICE INCREASE
CAUSED BY CRUDE OIL PRICES, FREIGHT COSTS
•••FUEL SELLS FOR N620 PER LITRE IN ABUJA
Alfred Lahiri, Abuja
The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mele Kyari, has said that the increase in petrol pump price from N540 to N617 and N620 per litre was caused by market forces.
Fuel now sells for N620 per litre in Abuja.
Kyari made the comment while speaking with State House Correspondents on Tuesday shortly after a meeting with the Vice President, Kashim Shettima, at the Presidential Villa Abuja, on Tuesday.
Kyari’s was reacting to the shocking increase in pump price of Premium Motor Spirit, from N537/litre to N617/litre as reflected by NNPCL maga stations in Abuja.
He explained that the increase was not due to shortage in the supply of the critical product.
According to him, the current price reflected the market realities as the price of the product could either increase or decrease.
“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.
“No, 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.”
Also, Chief Executive Officer, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, said that the recent abominable price increase was a product of rising crude prices.
Nigerians are shocked that they are made to pay more for refined petroleum products even when the country is the sixth highest producer of crude oil in the world.
Ahmed stated also that other costs in the process of importing the product contributed to the price increase.
He said, “So when you say market forces are working, basically what it is, is that you…you can see the price of crude going up.
“A week or so ago, the price of crude was hovering around $70 per barrel. Now, it’s over $80 per barrel. So, of course, the crude prices also drive the product price.
“As the importers are importing, they basing it on the cost of importation plus the freight plus other costs elements in terms of local distribution.”
Early on Tuesday, fuel queues resurfaced in parts of the Federal Capital Territory with the reports that the fuel pump price has been reviewed from N537 to N617 per litre.
Our correspondent observed that while stations operated by the NNPCL sell the product at N617 per liter, marketers have adjusted their meters to N620 in Abuja.
Motorists who are jolted by the pump price increase besieged the filling stations in large numbers to buy the products which caused the sudden reappearance of long queues in the stations.
Independent oil marketers who confirmed the increase in the fuel pump price said that it was a result of the increase in the price of the product by stations operated by the NNPCL.
The National Operations Controller of the Independent Marketers Association of Nigeria (IPMAN), Mike Osatuyi, said that there were projections there could be an upward review of the pump price from the third week of July 2023, when new fuel imports come into the country.
According to him, the increase of the pump price is caused among others by the recent increase in crude oil prices in the international market, the increase in the Dollar to Naira exchange and the transportation costs that require marketers to transport fuel to distant cities in the North.
On May 29, President Tinubu announced the removal of the fuel subsidy which moved the price upward from N198 to N537 and N540.
