Petroleum product marketers have expressed concerns over their financial losses following the recent price reduction by the Nigerian National Petroleum Company Limited (NNPC). On Monday, the NNPC lowered the price of Premium Motor Spirit (PMS), also known as petrol, to N880 per litre in Lagos and N935 per litre in Abuja.
The price adjustment marks a reduction from the previous price of N925 per litre in Lagos and N950 per litre in Abuja. The NNPC implemented the new prices just days after the Dangote refinery reduced its ex-depot price from N865 to N835 per litre, signaling an emerging price war between the two oil giants. As a result, Dangote’s refinery partners, including MRS, Heyden, and Ardova, have adjusted their prices to N890 per litre in Lagos, N900 in the South West, N910 in the South-South, and N920 in the North East.
Despite the NNPC’s price reduction, some of its filling stations are still selling petrol at the previous rates. This is due to a policy allowing stations with existing stock to sell at the old prices before switching to the new rate.
Hammed Fashola, the National Vice President of the Independent Marketers Association of Nigeria, confirmed the price cuts, stating that many filling station operators are now facing financial losses. “It’s confirmed that NNPC has reduced PMS prices. It is now N880 per litre in Lagos,” Fashola explained. “Some stations have already adjusted the price, but those with old stock are still selling at the old rate, like N910 per litre.”
Fashola acknowledged that while the price cut is beneficial for consumers, it has left marketers at a disadvantage. “The price reduction is a welcome development, but it has a negative impact on the side of the marketers. We are losing money. That’s just the truth,” he said.
He further explained that while the deregulation of fuel prices provides benefits for the public, it is difficult for marketers to adjust without incurring financial losses. Marketers are now working to sell their remaining stock at the old price before switching to the new rates.
When asked about the potential for further price drops, Fashola refrained from making any predictions, citing factors like crude oil prices and exchange rates as major determinants of petrol pricing. “If the crude oil price drops to something like $50 per barrel, it will have significant implications for the economy, government revenue, and inflation,” he said.
The recent price reduction comes amid continued efforts to regulate fuel pricing and market competition. As the NNPC and Dangote refinery adjust their prices, the outlook for fuel costs in Nigeria remains uncertain, with marketers continuing to bear the brunt of these fluctuations.
