Drop In Petrol Landing Cost Announced

Drop In Petrol Landing Cost AnnouncedThe estimated cost of landing Premium Motor Spirit (PMS), commonly known as petrol, in Nigeria has dropped significantly by 20.34%, falling to N971.57 per litre over the past three months. This reduction in landing cost, which encompasses the price of importing and distributing the fuel, reflects some stabilization in global market conditions and supply chain factors.....KINDLY READ THE FULL STORY HERE▶

Despite this decrease in the landing cost, however, the retail price of petrol has surged by N443, or 71.79%, rising from N617 per litre on August 1, 2024, to N1,060 per litre by November 8, 2024. The increase in petrol prices at Nigerian pumps has raised concerns, especially as the landing cost has been falling.

According to data from the Major Oil Marketers Association, in August 2024, oil marketers imported petrol at a cost of N1,219 per litre, with a Brent crude oil price benchmark of $80.72 per barrel and an exchange rate of N1,611 per dollar. At this time, petrol was sold at N617 per litre.

However, in November 2024, despite the estimated landing cost dropping to N971.57, the price of Brent crude falling to $75.57 per barrel, and the exchange rate strengthening to N1,665.84 per dollar, petrol prices have risen to N1,060 per litre at the Nigerian National Petroleum Company Limited (NNPCL) retail stations, and N1,180 per litre at independent marketer stations.

The landing cost of petrol had also been recorded at N945.63 in September 2024 and N903.64 per litre in October 2024, showing a general decline in importation costs. However, the increase in retail prices, despite falling landing costs, is largely attributed to ongoing market deregulation, exchange rate volatility, inflationary pressures, and broader economic challenges in the country.

Experts believe that the recent reduction in landing costs should, in theory, result in a corresponding drop in retail petrol prices. However, the continued rise in pump prices has raised questions about the role of fuel marketers and the government in addressing this disconnect.

In a related development, the Nigeria Labour Congress (NLC) accused fuel marketers of inflating petrol prices, arguing that the current pump prices are far above the actual market value. In a communique released following its National Executive Council meeting, the NLC criticized government policies, stating that Nigerians are being exploited and subjected to greater hardship, which is pushing many into poverty. The NLC’s statement reflects growing concerns over the economic burden on Nigerians and a call for accountability from both fuel marketers and the government to protect the welfare of citizens.

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