Lagos, Nigeria (VOICE OF NAIJA)- THE Federal Government says oil marketers have pledged to review current petrol pricing and explore measures to reduce pump prices following concerns that recent declines in global crude oil prices have not been reflected in the domestic market.
The commitment emerged after a high-level meeting between government officials, refiners, marketers and other downstream petroleum stakeholders convened to address the pricing of Premium Motor Spirit (PMS), commonly known as petrol.
Speaking after the meeting in Abuja, the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, said the government challenged industry operators over what it described as the slow adjustment of petrol prices despite the sustained decline in international crude oil benchmarks.
According to the minister, current pump prices do not adequately reflect prevailing market conditions.
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“The current prices are not cost-reflective and do not mirror the cost of crude oil,” Lokpobiri said.
He noted that while marketers argued that some Nigerian crude grades, including Iboe crude, remain relatively expensive, the government questioned why fuel prices rose rapidly when Brent crude climbed above $118 per barrel but have been slower to decline as global oil prices eased.
“We told them that if prices could increase quickly when crude oil rose, consumers should also benefit when crude prices fall. They have agreed to return, review the issues and work towards addressing the high cost of PMS,” he said.
Lokpobiri reiterated that although Nigeria’s downstream petroleum sector has been deregulated, the Federal Government will continue engaging market participants to ensure that consumers benefit from favourable market developments.
The meeting, held at the headquarters of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), brought together key players across the downstream value chain, including Dangote Refinery, the Federal Competition and Consumer Protection Commission (FCCPC), PETROAN, MEMAN, DAPPMAN, IPMAN, NARTO, TotalEnergies, Eterna, Matrix Energy and other industry operators.
The discussions focused on practical measures to improve price transparency, promote healthy competition and ensure that domestic fuel prices respond more effectively to movements in the international oil market.
Lokpobiri stressed that deregulation should encourage efficiency and competition rather than excessive pricing, adding that reductions in Brent crude prices should ultimately translate into lower prices for both petrol and Automotive Gas Oil (diesel).
He urged stakeholders to build consensus around pricing mechanisms that protect consumers while preserving a commercially viable downstream market.
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The Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Rabiu Abdullahi Umar, said the engagement was aimed at promoting cost-reflective pricing and improving collaboration among operators on inventory management, market surveillance and the maintenance of strategic fuel reserves.
The meeting comes amid increasing regulatory scrutiny of domestic fuel pricing.
In recent weeks, the Federal Competition and Consumer Protection Commission (FCCPC) expressed concern that reductions in gantry and retail petrol prices have not matched the scale of the decline in global crude oil prices.
The Commission said its market monitoring showed that while petroleum prices in Nigeria typically rise almost immediately when international crude prices increase, reductions are often delayed when global prices fall, limiting the benefits available to consumers.
It called on refiners, depot operators, marketers and retailers to ensure that pricing more accurately reflects prevailing international market conditions and the principles of a competitive deregulated market.
The latest engagement signals the Federal Government’s renewed effort to improve price transmission in Nigeria’s downstream petroleum sector, with the expectation that lower international crude oil prices will ultimately translate into more affordable fuel for businesses and households while sustaining investor confidence in the deregulated market.
