The Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Association of Distributors and Transporters of Petroleum Products (ADITOP) have rejected claims of an impending increase in the price of petrol to N700 per litre.
During an interview with the News Agency of Nigeria (NAN) in Abuja, both associations dismissed these reports as mere speculation and predictions. They emphasized that fuel prices are determined by market forces and are influenced by the current high exchange rate, which could result in a potential increase in the pump price of Premium Motor Spirit (PMS), commonly known as petrol.
Several oil marketers had speculated that petrol prices in the northern region could rise above N700 per litre and around N600 per litre in Lagos once independent marketers begin importing petroleum products from July. These predictions were based on the current high exchange rate, crude oil prices, and landing costs.
The situation led to anxiety and panic buying, with long queues of motorists forming at some filling stations in the Federal Capital Territory (FCT) at the start of the weekend. Meanwhile, retail outlets of the Nigerian National Petroleum Corporation Limited (NNPCL) and others continued to dispense fuel at prices ranging from N540 to N542 per litre.
IPMAN President Chinedu Okorokwo, in an interview with NAN, dismissed reports of a price hike starting from July 1 as mere speculation. He stated that any increase in pump prices would be due to the high dollar exchange rate, which could impact the importation of petroleum products. Okorokwo emphasized that the oil market is now open to importers who must obtain licenses from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
ADITOP President Alhaji Lawan Dan-Zaki attributed the predictions of a price increase to the current high exchange rate, stating that importers would sell fuel according to the prevailing international market rates. He urged Nigerians to be patient, as the price of PMS would continue to fluctuate under the deregulated market until it stabilizes due to market forces.
Dan-Zaki added that the NMDPRA had issued licenses to five companies for fuel importation. He explained that the predictions made by marketers were speculative, as no cargoes were currently being imported at the high price. Dan-Zaki highlighted that the market competition would eventually lead to a decrease in the pump price of fuel. He stressed the importance of allowing market forces of supply and demand to determine the price, as the government’s deregulation policy permitted marketers to import fuel independently.
Regarding the impact of exchange rates, Dan-Zaki noted that the official exchange rate set by the Central Bank of Nigeria (CBN) was no longer realistic. Importers now had to purchase at the black-market rate, which would influence the selling price to marketers and consumers. He explained that if an importer acquired products at an exchange rate of N700 per dollar, it would be impractical for marketers to buy at that rate and sell at the same price.
Dan-Zaki urged the Federal Government to expedite the resumption of local refineries, including the Dangote refinery, to eliminate the need for fuel importation and mitigate potential price increases in the country.