Price of fuel will inflate to N700 per liter in the month of July - Marketers

 

The Independent Petroleum Marketers Association of Nigeria has projected that the pump price of petrol could rise above N700 per litre in some states in the country starting from July.

IPMAN's National Controller Operations, Mike Osatuyi, who disclosed this during an interview with Punch, said they've projected that those living in northern states could pay as much as N700 and above

for one litre of petrol, those outside Lagos would pay around N610, while residents of Lagos would pay about N600 for a litre.

Osatuyi said the price review was necessitated by the exchange rate. He said; 

“What I am seeing is around N600 and above, depending on the exchange rate, the current crude price at the international market and the landing cost. Those in Lagos will pay around N600, those outside Lagos around N600 plus, while those in the north would be paying anything from N700 and above.

“We are expecting the 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.

“Already, three marketers have been confirmed to start bringing in products starting from July. That’s when we would know the real price of products because it would definitely increase. This current price is just a transitional price.”

Executive Secretary, Depot and Petroleum Products Marketers Association of Nigeria, Olufemi Adewole, also told the publication that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), is currently licensing more importers.

Adewole also said that arrangements are on full speed for fresh products from July, adding that prices of products would depend on market fundamentals.

He said; 

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

“Prices of products will depend on market fundamentals, and as we speak, the Nigeria Customs Service is delaying some AGO (diesel) vessels because of the 7.5 per cent VAT.

“And don’t forget, any cost incurred by marketers would be added to landing cost, and then to the pump price. The marketer would also have to add profit because they must make profit.”

A former chairman of the Major Oil Marketers Association of Nigeria, and Chief Executive Officer/Chairman of 11 Plc, Tunji Oyebanji, also said that consumers should expect new pump prices close to that of diesel, and those of neigbouring African countries that also import petrol.

He said; 

“The truth now is that if you look at the prices of other West African countries that also import petrol, then, you will have an idea of what the price will likely be once companies start importing. So, if the price we have now is not anywhere close to theirs, then, we are not yet there. Another indicator should be the current price of diesel.

“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 customers can come and buy. There would be healthy competition which is good for the market.

“There are currently products in the country and we are loading at a government price of N496.50 per litre. But because of the new forex policy of the central bank, the naira has shot up to around N765/$1. Until new products start coming in, we won’t know the exact extent to which the new policy would affect our business.

“It’s 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’s 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.”