The estimated landing cost of Premium Motor Spirit (PMS), commonly known as petrol, in Nigeria has dropped by 20.34%, falling to N971.57 per litre over the past three months.
This reduction reflects improvements in global market conditions and supply chain dynamics.
However, despite this decrease, the retail price of petrol in Nigeria has increased dramatically, rising by N443, or 71.79%, from N617 per litre on August 1, 2024, to N1,060 per litre by November 8, 2024.
According to data from the Major Energies Marketers Association, the price of imported petrol in August 2024 was N1,219 per litre, with a Brent crude oil benchmark of $80.72 per barrel and an exchange rate of N1,611 per dollar.
During this period, petrol was sold at N617 per litre. By November, the estimated landing cost of petrol had dropped to N971.57, with a Brent crude benchmark of $75.57 per barrel and an exchange rate of N1,665.84 per dollar.
Despite this, retail prices have continued to climb, with petrol selling at N1,060 per litre at Nigerian National Petroleum Company (NNPC) retail stations and N1,180 at independent marketer stations.
Further data revealed that the landing cost stood at N945.63 in September and N903.64 per litre in October.
Despite these declines, the rise in retail prices can be attributed to factors such as the ongoing deregulation of the fuel market, fluctuations in the exchange rate, rising inflation, and broader economic challenges facing the country.
Experts suggest that the reduction in landing costs should ideally result in a corresponding drop in retail prices, but the factors contributing to the price hike remain persistent.
In response to the rising fuel prices, the Nigeria Labour Congress (NLC) has accused fuel marketers of inflating prices, claiming that the pump price is much higher than the actual market value.
In a communique released following its National Executive Council meeting, the NLC criticized government policies, asserting that they have exacerbated suffering and hunger among Nigerians, pushing many into economic hardship. The union’s call emphasizes its commitment to holding both the fuel marketers and the government accountable for the welfare of the citizens.
(Punch)
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