Fakoyejo OlalekanThe Independent Petroleum Marketers Association of Nigeria (IPMAN) has listed three reasons the costs of Premium Motor Spirit (PMS), also known as fuel, has to be above N500 per litre.
According to the Deputy President of Zarama Mustapha, the Nigerian National Petrol Company (NNPC) Limited, transportation cost and profit margins are reasons fuel prices can’t be sold for anything less than N500.
Join our WhatsApp ChannelHe explained during an interview on Channels Television’s Sunrise Daily programme on Thursday, 1 June, that the NNPC being the sole importer of fuel is affecting pricing.
Mustapha hinted that there’s no competitor to NNPC, so the company is the sole decider of the cost of fuel in the Nigerian market.
He suggested that should other companies be given the approval to import fuel, NNPC’s monopoly on fuel prices will be broken, giving room for competitive prices.
Prime Business Africa gathered that the oil marketers buy fuel at the cost of N460 per litre from private deports after the NNPC imports the refined products into Nigeria.
The IPMAN president also stated that oil marketers need to add transportation costs and profit margins to the pump price, resulting in the cost rising above N500 a litre.
Mustapha said: “NNPC being the sole supplier is the determiner of how much we purchase. The deregulation is just taking effect. May be with time, they will allow other players to also participate in the importation of the product to compete with the NNPC Limited.
“I still believe the NNPC is still the government because it is owned by the government.”
Recall that a day before, the NNPC increased fuel prices from N189 per litre to above N500, with prices varying by region.
Commenting on the increment, the NNPC said: “NNPC Limited wishes to inform our esteemed customers that we have adjusted our pump prices of PMS across our retail outlets, in line with current market realities.
“As we strive to provide you with the quality service for which we are known, it is pertinent to note that prices will continue to fluctuate to reflect market dynamics.”
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