The Federal Government announced a reduction of N5 from the pump price of Premium Motor Spirit (petrol). Against the backdrop of this reduction, fuel marketers have said that it is not possible to sell the product at N162 per litre amid the current market realities.
The Minister of Labour and Employment, Dr. Chris Ngige who announced the petrol price cut at the end of a meeting with labour leaders which began around 9pm on Monday and ended at 1:30am on Tuesday said: “Our discussion was fruitful and the Nigerian National Petroleum Corporation, which is the major importer and marketer of petroleum products, and customers have agreed that there will be a slide down of the pump price of PMS and that the price cut will get us about N5 per litre and that the price cut will take effect from next Monday, a week today.”
Top officials of the marketer’s associations said on Tuesday that the price decrease had not been communicated to them, adding that they only read media reports that the government had reached an agreement with the organized labour to reduce petrol price by N5 per litre.
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The National Operation Controller, Independent Petroleum Marketers Association of Nigeria, Mr Mike Osatuyi said, given the recent increase in global oil prices and the devaluation of the naira, petrol price of N162 cannot work, except we are going back to subsidy.
He stated that, “The government said it had deregulated; so, it is not possible to sell petrol at N162 on December 14. If you ask anybody now in the industry, they will tell you the price at which they can sell is about N170 to N180.
“The minister of labour does not have the power to determine the price of petrol. Even the President can only do that if we go back to subsidy.”
In reaction to this development, the National President, Petroleum Products Retail Outlets Owners Association of Nigeria, Dr Billy Gillis-Harry, said the interference by government in petrol pricing had continued to defeat the purpose of deregulation.
In September, the Minister of State for Petroleum Resources, Chief Timipre Sylva, had said that the Federal Government had stepped back in fixing the price of petrol, adding that market forces and crude oil price would determine the cost of the product.
Gillis-Harry said marketers had lost millions of naira as a result of the frequent price adjustments. “We have no circular to confirm that price adjustment, and as far as we are concerned, we cannot say it will be implemented until we get an official communication about it,” he added.
When contacted to find out when the government would issue a circular to marketers regarding the price reduction, the Special Assistant to the Minister of State for Petroleum Resources, Mr Garba-Deen Mohammed, promised to revert, but had yet to do so as of the time of filing this report.
The Vice President, IPMAN, Mr Abubakar Maigandi said, “We are waiting for the circular from the government. We can only implement the price reduction when we get the circular,”
It would be recalled that the Federal Government removed petrol subsidy in March this year after reducing the pump price of petrol to N125 per litre from N145 on the back of the sharp drop in crude oil prices. The price reduction lasted till June.