The Federal government of Nigeria yesterday, finally hands off the responsibility of fixing the price of fuel, especially PMS, otherwise called petrol, a step market watchers termed full deregulation of the downstream petroleum sector.
The prices of the commodity will now be determined by the prevailing market forces, which will stern from the prices of crude oil in the international market, among other factors.
The Executive Secretary of the PPPRA, Saidu Abdulkadir, Represented by the General Manager, Administration, and Human Resources of PPPRA, Mr. Victor Shidok, made the announcement on Tuesday, he, however, said the implementation would play out fully when oil marketers resumed the importation of fuel, claiming, Forex challenges and the prevailing economic uncertainty have been preventing the marketers from importation fuel.
Abdulkadir said: “With government’s pronouncement that the sector is deregulated means that prices would strictly be based on the forces of demand and supply.
“You can have a regulator that always serves as a watchdog to see how these forces are being played out; how the interests of all operators and consumers are taken care of.
“It is a market that is open based on bargaining power and based on where you source your product.
“Petroleum Products Marketing Company (PPMC) is a marketer; it also sells the product and also carries out the analysis as to the price it wants to sell the products to its customers.
“That is the announcement they always make after doing an analysis of their cost and analysing their margins,” he said.
Giving a background on how the price-fixing works, Abdulkadir said the PPMC had been the one announcing the fuel prices over the last few months because it was within its rights to do so as one of the oil marketers and a major supplier.
He further explained that the prices of fuel is not always directly correlated with crude oil prices in the international market, adding that a number of other factors are responsible for the price of the commodity.
He reiterated that the price of petrol in the Nigerian market would be determined by market forces.
He said the PPMC, just like other marketers and importers, would now continue to determine the prices at which they would sell to their customers.