By Damilola Adeyemo
ABUJA – The Executive Secretary/Chief Executive Officer, Major Oil Marketers Association of Nigeria, Mr. Clement Isong, has said that the sustained increase in global crude oil prices had pushed up the landing cost of imported petrol closer to the current pump prices of the product in Nigeria, and appeared to have triggered a return to petrol subsidy era.
According to THE PUNCH, Since November 13, 2020, when the pump prices of PMS were last increased in the country, the price of the international oil benchmark, Brent crude, has increased by 43 percent, rising from $41.51 per barrel to $59.34 per barrel on Friday.
Fuel marketers had in December expected another upward adjustment of PMS prices to reflect the further rise in crude oil prices, which closed at $51.22 per barrel on December 31.
However, a N5 reduction in petrol price, effective December 14, was announced by the Federal Government – a development that left them reeling in shock and questioning the deregulation of petrol price.
Crude oil price accounts for a large chunk of the final cost of petrol, and the country has continued to spend so much on petrol imports for many years amid low domestic refining capacity.
The product is currently sold at between N160 and N165 per litre at many filling stations in Lagos.
In a statement, the Executive Secretary/Chief Executive Officer, Major Oil Marketers Association of Nigeria, Mr. Clement Isong, said, “Members of my association are operating in Nigeria and care about the long-term sustainability of the industry as well as the country itself.
“So, we know that depending on what exchange rate you use, the pump price should be between N185 and N200 per litre. “For as long as we continue to sell the product at what we are currently selling it, then somebody is bearing the cost of subsidy
“So, we need to completely restructure our entire supply chain. We need to reach a place where, if deregulation takes effect, refining will resume in Nigeria. We need to find a way of making sure that Nigerians benefit from deregulation. That, I believe, is what the discussion must be.”
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