rice of Petrol may crash to N300 per litre
Operators of modular refineries have on Sunday stated that the pump price of Premium Motor Spirit, popularly known as petrol, should drop to about N300/litre upon the commencement of massive production by the Dangote Petroleum Refinery and other indigenous producers.
Although they pointed out that this would be achieved when the government makes adequate provision of crude oil to local refiners, noting that foreign refineries were ripping off Nigeria.
Speaking under the aegis of the Crude Oil Refinery Owners Association of Nigeria, the Publicity Secretary, Eche Idoko, while speaking to Punch correspondents said: “A lot of companies today benefit from the importation of petroleum products at the expense of Nigerians.
“if we begin to produce PMS today in large volumes, provided there is adequate crude oil supply, I can assure that we should be able to buy PMS at N300/litre as the pump price.
“Why make Nigerians buy it at almost N700/litre when you know that if you allow refineries work the price will come down? Is it because you want to satisfy the global refiners abroad that are making so much from us?.
“We were selling diesel for N1,700 to N1,800/litre, but as soon as Dangote refinery started production he brought down the price to N1,200/litre. What other proofs do you need?
As I speak to you now there is every tendency that before December diesel price will drop further. The only reason reason why diesel is not doing below N1,000/litre is because of our exchange rate.
“If the exchange rate drops, diesel will drop below the N1,000/litre price. Now the exchange rate concern is because Dangote imports crude. If he is not importing, the exchange rate may not have so much effect, though he is still buying crude in dollars (in Nigeria) anyway.”
On May 18, 2024.
Aliko Dangote had earlier said: “Right now, Nigeria has no cause to import anything apart from gasoline (petrol) and by sometime in June, within the next four or five weeks, Nigeria shouldn’t import anything like gasoline; not one drop of a litre.”
Recall that earlier in the year Dangote had crashed the pump price of diesel to N1,200/litre when the commodity was selling at between N1,700 and N1,800/litre at the time.
He further reduced the price to below N1,000/litre, but could not sustain this price due to the rise in exchange rate.
The refinery finally returned the price to the initial rate of N1,200/litre.
Speaking on Sunday, the CORAN spokesperson said: “We have told them (government) that even the dollars that you are asking us to use and buy this product, it is detrimental to the country. Strengthen the naira. We will buy at the international market rate, but at a naira equivalent.
“These are the issues and they know these things but we can’t explain why they really can’t take decisions to change these concerns.
“Get crude to local refineries, allow crude purchase in naira equivalent, make the environment business-friendly and watch locally produced petroleum product prices crash.”
Nigeria currently has 25 licensed modular refineries.
Five of them are currently operating and producing diesel, kerosene, black oil and naphtha. About 10 are under various stages of completion, while the others have received licences to establish.
The National President, Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi, had said: “Only about five of our members have completed their refineries. The others are having a major challenge.
“This challenge is that the people who are supposed to finance them have not disbursed financing for construction because they want some level of guarantee.
“A guarantee that if they finish the refinery, they are going to get feedstock, which, of course, is crude oil,” Idoko had explained.
Oil marketers also believe that the cost of petrol should be lower than its current price once its production begins in Nigeria.
They welcomed the comment of Dangote that his refinery should start pumping out petrol this month, and expressed hope that the cost would be less than the price which the Nigerian National Petroleum Company Limited currently sells.
“We expect a reduced price for locally produced PMS, as I’ve earlier told you.”
Maigandi, while speaking from Saudi Arabia with Punch on Sunday, said: “It is a welcome development if the refinery can start releasing PMS this month because as marketers we are currently set to start buying the product from the plan.
“We have been discussing, but not about the price of petrol yet, rather on other matters such as the registration of members for the purchase of petrol and diesel from the refinery.
“It is true that we have started buying diesel from them, but you have to register with the company first. So a general registration is ongoing,” he explained.
Maigandi, however, said: “We are looking at having it (PMS) at any price below the NNPC rate. The price which NNPC sells petrol is N565.50/litre, so we are expecting something below that price, maybe around N500/litre.
“Of course, it is important for crude to be made available to local refineries because this will surely affect petroleum products’ prices positively.”
