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Oil Marketers Demand Increase In Petrol Prices As Ghana, Others Sell At N1,000/litre

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Oil Marketers Demand Increase in Petrol Prices as Ghana, Benin, Togo, Others Sell N1,000/litre - Legit.ng

The Nigeria Oil marketers have insisted that the current prices of petrol in the country were not a true reflection of the market, saying that a further price review will make them break even.

This is coming after petrol prices were increased twice in two months from N189/liter to N500/liter and, recently, from N537 per litre to N617/ litre across Nigeria.

Meanwhile, former Chairman of the Major Oil Marketers Association of Nigeria and Chief Executive Officer, 11 Plc, Tunji Oyebanji, told The PUNCH in a chat that oil prices would reflect current market realities.

According to him, this is what is obtainable in other neighboring African countries that import petrol.

“If the prices in neighboring countries reflect true market prices and our own do not, there is still a danger. Until we all import at the new exchange rate and know what the price is and compare it with our neighbors, we won’t know the exact situation. Likely, the differential will not be so much,” Oyebanji claimed.

He also added that competition was healthy for the downstream sector, as it would allow for fair play.

“The bottom line is that there will be an adjustment in price. Yes, it may go up now. It could also drop depending on the exchange rate. But the good thing is that products would be everywhere, and if you see that yours is more expensive than those of the filling stations around you, you will be forced to bring down prices so that customers can come and buy. There would be healthy competition, which is good for the market,” he continued.

“We are expecting a roadmap from the Federal Government following the meeting with labour.

“Labour has said they are giving the government two months to come up with the roadmap. We are also expecting the roadmap on how to deepen the use of Compressed Natural Gas.

Oyebanji also warned of the return of smuggling if market forces are not allowed to control the market.

“Would we not see tankers being diverted again to our neighbours? The price differential between us and our neighbours, apart from greed, what else could account for this level of disparity in these June figures?” he wondered.

Oyebanji also declared that depot owners were resorting to both local and foreign loans to finance importation.

“It is not like we are just getting importation licenses. We have been licensed, but we stopped importing because it was no longer profitable. Now, everybody is trying to see what we can do. Some people will raise money and borrow from abroad, while others will borrow from local banks. It is not just three companies that would be importing. Many companies are currently running around to start bringing in products. But we won’t be shouting about it on the pages of newspapers,” he said.

Also, a source at a depot in Lagos, who does not want his name in print, hinted that more importers were currently being licensed.

He added that smuggling or diversion of products to neighbouring countries would continue if full deregulation was not allowed to take its course.

“Where do countries like Ghana, Benin, and Cameroun get their products from? Is it not from Nigeria?” he asked.

“The prices of products will depend on market fundamentals. And as we speak, Customs is delaying some AGO (diesel) vessels because of the 7.5 per cent VAT. Any cost incurred by marketers would be added to the landing cost, and then to the pump price. The marketers would also have to add profit because they must make a profit,” he said.
Meanwhile, the products sells as high as N1,100 in countries like Mali and Togo. Recent reports say that black market fuel vendors and commercial drivers in Cameroon, Benin, and Togo have seen the collapse of their businesses due to low supplies and high prices as Nigeria removed subsidies from petrol.

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