Fuel Prices Remain Stubbornly High Despite Global Crude Oil Decline
Despite a significant drop in global crude oil prices, consumers in Nigeria are still facing stubbornly high prices at the pump for Premium Motor Spirit (PMS), commonly known as petrol. Crude oil has fallen to around $100 per barrel from a peak of $130 per barrel, a development that typically signals a decrease in retail fuel costs. However, investigations reveal that oil marketers have largely failed to pass this reduction on to consumers, with petrol continuing to be sold at N1,300 per litre and even higher in various parts of the country.
The global decline in crude oil prices was initially spurred by expectations of increased supply, particularly with the potential return of Iranian oil to Asian markets amid ongoing diplomatic efforts. This shift in the international market was anticipated to ease inflationary pressures on petroleum products worldwide.
Price Discrepancies Across the Nation
Investigations conducted in Lagos and its surrounding areas have highlighted a stark contrast between global market trends and local retail prices. Numerous retail outlets, including those operated by MRS, were observed selling petrol at approximately N1,333 per litre. While depot prices were marginally lower, they still reflected a significant cost. For instance, depot operators such as Alkanes, Soroman, and Bovas were pricing the product at around N1,270 per litre, with Dangote Petroleum Refinery setting its price at N1,285 per litre.
The situation in Abuja, the Federal Capital Territory, mirrored that of Lagos. Petrol stations maintained elevated prices, with some reaching as high as N1,371 per litre, even more than 24 hours after the global crude price drop. NIPCO and AYM Shafa were among the stations with the highest prices in Abuja, selling at N1,371 and N1,370 per litre, respectively. NNPC Retail stations were selling at around N1,361 per litre, while MRS, reportedly a partner station of Dangote, was priced at N1,367 per litre.
This persistence of high fuel prices has understandably generated considerable concern among consumers, who had expected a corresponding reduction in pump prices following the downward trend in global crude oil markets. Over the past three weeks, petrol prices in Abuja alone have reportedly surged by over 50 percent, a phenomenon largely attributed to successive increases in gantry prices by Dangote Refinery. The decision by marketers to maintain these elevated prices has exacerbated the financial strain on Nigerians, who are already contending with escalating transportation and general living costs.
Voices from the Ground: Attendants and Experts
When approached for comment, a pump attendant at an AA Rano filling station in Karu, who preferred to remain anonymous, stated that pricing decisions are not within the purview of station attendants. “Sir, it is not my job to change the metre. That is the work of the manager and the engineer,” they explained.
Calls for Regulatory Intervention
The persistent high cost of petrol has prompted calls for increased oversight from regulatory bodies. Olatide Jeremiah, CEO of Petroleumprice.ng, has urged regulators to step in and protect consumers from what he describes as exploitation.
“The oil price has been dropping in recent days, yet Nigerians have not seen a corresponding reduction in pump prices,” Jeremiah stated. “This has worsened instability in the downstream sector. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Federal Competition and Consumer Protection Commission (FCCPC) need to protect consumers from exploitation, as marketers are quick to increase prices but slow to reduce them, thereby making abnormal profits at the expense of Nigerians.”
Market Forces vs. Regulation Debate
Conversely, Billy Gillis-Harry, President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), advocates for a hands-off approach, believing that market forces should dictate fuel prices. “This is a deregulated market, and the forces of demand and supply should be allowed to guide operations,” he asserted. Depot owners, when questioned about the sustained high prices despite the drop in crude oil costs, declined to comment.
Ripple Effect: Rising Transport Fares
The impact of these high fuel prices is being directly felt by commuters, as transport operators have passed on the increased costs. This has led to a significant rise in transport fares across the country, further eroding the purchasing power of citizens. One civil servant, speaking anonymously, shared their experience: “Before the Middle East conflict, we paid N800 from Ikorodu to Oshodi. Now, we pay about N1,200, representing a 50 per cent increase.” They described the situation as “unbearable,” highlighting that salaries have remained stagnant amidst rising inflation and living expenses.
Industry Perspectives: Risks and Opportunities
Industry experts have weighed in on the complex dynamics of the global and local energy markets. During a recent webinar hosted by the Major Energies Marketers Association of Nigeria (MEMAN) in partnership with S&P Global Energy, MEMAN Chairman, Huub Stokman, noted that the Middle East crisis has amplified uncertainty in global oil markets. This has resulted in increased price volatility, higher freight costs, and disruptions to global supply chains. Stokman, however, also pointed out that these challenges present an opportunity for Nigeria to solidify its position as a regional energy hub, leveraging its high-quality crude, expanding refining capacity, and substantial domestic market.
Gary Clark, Associate Editorial Director at S&P Global Energy, observed a sharp increase in refining margins for products like diesel and aviation fuel, driven by supply disruptions and elevated risk premiums. Stanislas Drochon, Africa Head of Fuels and Refining at S&P Global Energy, highlighted Sub-Saharan Africa’s vulnerability to external shocks due to its heavy reliance on imports, limited refining capabilities, and insufficient storage infrastructure, emphasizing the need for sustained investment in supply chain systems to bolster long-term energy security. Energy expert Joe Nwakwue characterized Nigeria’s transition to a deregulated downstream market as an adjustment period marked by price volatility and structural shifts.
Vice President Assures of Progress on Insecurity and Political Realignment
Abuja, Nigeria – Vice President Kashim Shettima has expressed optimism regarding the nation’s security situation, stating that an end to insecurity is within sight. He affirmed that President Bola Tinubu is diligently working to ensure sustained peace across all regions of the country. The Vice President called for greater unity, progress, and peaceful coexistence under the current administration, reiterating the President’s commitment to safeguarding lives and properties nationwide.
Speaking in Gusau, the capital of Zamfara State, the Vice President formally welcomed Governor Dauda Lawal and his supporters into the All Progressives Congress (APC) on behalf of President Tinubu. He remarked, “We pray for more unity and progress under President Bola Ahmed Tinubu because as our leader is working very hard to ensure the safety of lives and property across Nigeria.”
Vice President Shettima assured that the security challenges plaguing Zamfara State and other affected regions would be addressed, noting that Governor Lawal’s defection to the APC would significantly contribute to achieving this goal. He further predicted that opposition parties such as the ADC and PDP would struggle to gain traction in Zamfara, given the consolidation of major political figures within the APC. He pledged full support for the Governor and commended the people of Zamfara for their backing of the Governor and the APC.
National Assembly and Governors Welcome Governor Lawal’s Defection
The Deputy President of the Senate, Senator Jibrin Barau, who represented the Senate President, Senator Godswill Akpabio, conveyed the National Assembly members’ complete support for Governor Lawal’s decision to join the APC. He stated that the Governor would now collaborate with other APC governors to address the state’s challenges and foster development. Senator Barau also commented on the global nature of security challenges, asserting that they are surmountable through collaboration. He emphasized that the Governor’s cooperation with fellow governors and the federal government would be instrumental in overcoming current difficulties, deeming his move to the APC as a wise decision.
Governor Hope Uzodimma of Imo State, Chairman of the Progressive Governors Forum (PGF), expressed the delight of APC governors in welcoming Governor Lawal into their fold. He thanked the people of Zamfara for their continuous support for their governor and described the move as a “win-win situation for Zamfara.” He added, “APC is a moving train and we are happy that the State has joined that train. All Governors of APC will support Governor Lawal to do more for this State.”
The APC National Chairman, Professor Nentawe Yilwatda, declared Zamfara an entirely APC state, citing assurances of support from former governors. He praised the Governor’s performance, particularly in enhancing development through significant infrastructural projects, including the construction of a new airport. Professor Yilwatda formally presented the APC flag and broom, the party’s symbol, to Governor Lawal, signifying his official entry into the party.
Governor Lawal, in his remarks, expressed gratitude to former governors, including the Minister of State for Defence, Bello Matawale, and Senator Abdulazeez Yari, for their support. He pledged to work towards the APC’s success in upcoming elections and committed to collaborating with his predecessors for the progress of Zamfara State.
Presidency Responds to Senator Ndume’s Security Concerns
Abuja, Nigeria – The Presidency has strongly refuted claims by former Senator Ali Ndume that Borno State and the entire North-East region are at risk of being overrun by terrorists due to inadequate arms for the Nigerian Army. In a swift response, the Presidency challenged the Senator to share any intelligence he possesses regarding terrorist plans with the military.
Senator Ndume had raised the alarm following a visit to the communities of Ngoshe and Pulka in Borno State, which had experienced coordinated attacks by Boko Haram and ISWAP insurgents. He reported that these attacks resulted in casualties among soldiers and civilians, with numerous women and children abducted. Ndume stated that the military was initially outmatched by the superior firepower of the terrorist groups and stressed the urgent need for enhanced military capabilities.
In a statement, the lawmaker urged the federal government to intensify efforts in arming the military, saying, “I gathered that our soldiers lacked adequate ammunition and had to withdraw from Ngoshe and Pulka because they were overwhelmed by the terrorists. It was only after reinforcements arrived that the military regained control of the areas.” He commended Governor Babagana Zulum for his visit to the affected communities and IDP camps and called for swift federal intervention in rebuilding the devastated areas and supporting displaced residents. Describing the extent of the destruction, Ndume noted, “Ngoshe was brought down to ground zero, with only a small mosque left standing.” He lauded the Nigerian Army’s resilience in recapturing the areas but reiterated that without urgent and sustained support, including modern weaponry and intelligence capabilities, the insurgency could escalate.
Presidency: Tinubu Administration Actively Equipping Armed Forces
Bayo Onanuga, Special Adviser to the President on Information and Strategy, responded to Senator Ndume’s concerns, asserting that the President Bola Tinubu-led government has been actively equipping the armed forces. He stated that the military and the Civilian Joint Task Force (CJTF) are engaged in combating the guerrilla warfare against terrorists to ensure the safety of the North-East and all Nigerians.
Onanuga questioned the purpose of Senator Ndume’s alarm, stating, “If he has intelligence that terrorists are planning to attack the entire North East, as a longtime senator, he should pass the information to the military, not engage in scaremongering.” He added, “The Tinubu government has been equipping the armed forces. It is not miserly about it. In addition to seeking assistance from countries such as the US, UK, France, and Turkey, we are also collaborating with our Sahelian neighbours. Our armed forces and the civilian JTF are doing everything humanly possible in waging this guerrilla war against the terrorists to make the North East and the Nigerian people safe.”
Military High Command Dismisses Fears of Takeover
The Military High Command has dismissed Senator Ndume’s concerns, maintaining that there is no basis for fears that terrorists could take over Borno and the North-East. Major General Michael Onoja, Director of Defence Media Operations, stated, “There is no basis for such a conclusion.” He added, “The Chief of Defence Staff has directed troops to take the battle to the insurgents and terrorists, and the results will manifest in the shortest possible time. The military is conducting operations in line with its mandate to ensure the return of normalcy to Borno State, the North-East and indeed the whole of Nigeria.” The military affirmed its commitment to degrading insurgents and restoring peace across the region.
