Nigeria Anticipates Petrol Price Reduction as Landing Cost Plummets.
Nigeria is anticipating a potential decrease in petrol pump prices following a significant drop in the landing cost of Premium Motor Spirit (PMS). The Major Energies Marketers Association of Nigeria (MEMAN) announced that the landing cost has plummeted to N981 per liter, a substantial reduction from recent levels.
This decline is primarily attributed to a decrease in global crude oil prices. Brent crude, the global benchmark, has been fluctuating between $70 and $75 per barrel this month, down from an average of $80 per barrel in August.
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The lower landing cost comes as a relief to consumers who have been grappling with rising fuel costs in recent months. The previous landing cost, hovering around N1,130 per liter, has been reduced by over N140 as of September 25, 2024.
The resumption of petrol imports by major oil marketers in Nigeria has also contributed to the potential price reduction. Following the recent deregulation of the downstream oil sector, these marketers have begun importing significant volumes of PMS to supplement domestic production.
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Additionally, the Dangote Petroleum Refinery, which recently commenced operations, is contributing to the domestic supply of petrol. However, there have been discrepancies regarding the sale price of the refinery’s product to the Nigerian National Petroleum Company Limited (NNPC). While the NNPC claims to purchase the fuel at N898 per liter, the refinery has denied this figure.
The potential price difference between imported petrol and that from the Dangote Refinery could influence the pricing decisions of marketers. If the NNPC’s claim is accurate, marketers may choose to sell imported fuel at a price lower than that obtained from the refinery.
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