JUST IN: Fuel Prices Begin To Drop Amid Deregulation

Fuel Prices Begin To Drop Amid Deregulation

As of November 19, 2024, Nigerians are experiencing the effects of a recent fuel price hike by the Nigerian National Petroleum Company (NNPC). However, signs of relief are emerging as the deregulation of the country’s oil sector is starting to drive down prices. According to the Independent Petroleum Marketers Association of Nigeria (IPMAN), increased competition among oil marketers is contributing significantly to this trend.

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Over the past 42 days, more than 2 billion liters of Premium Motor Spirit (PMS) have been imported by NNPC and other companies. This influx has alleviated some of the pressure on the country’s fuel supply. A crucial partnership between IPMAN and the Dangote Petroleum Refinery is also aiding in price reduction. The refinery has committed to supplying IPMAN with 60 million liters of petrol weekly, adding up to 240 million liters monthly. This arrangement is expected to help meet demand and further lower costs.

Located in Lekki, the Dangote refinery is actively seeking funds to enhance its crude oil imports and boost production capacity, which could further improve fuel availability in the long run. Deregulation has been pivotal in increasing competition, which is essential in bringing prices down and ensuring a more stable market.

Despite these positive developments, challenges remain. Rising costs of fuel and electricity, coupled with the floating naira, have raised concerns among Nigerians. Aminu Megbontowon, the president of the National Union of Shop and Distributive Employees (NUSDE), has criticized these policies. He noted that petrol prices have spiked to over N1,000 per liter, while electricity tariffs have jumped from N68 to N227. Such increases are seen as unsustainable for an oil-producing nation where many citizens already face low purchasing power.

In light of these economic strains, labor unions have urged President Bola Tinubu to reconsider these policies, emphasizing the need to address the mounting financial burden on ordinary Nigerians.