Business

Deregulation amid new price for petrol

 

African oil producers face slump in production

 

Nigerians, again, got a new price for Premium Motor Spirit (PMS) also known as petrol on Friday. Adeola Yusuf, in this report, shows how profiteering resulting from this demarketed the deregulation policy and attracted harsh reactions from Nigerians

 

 

For over one week after the prices of Premium Motor Spirit (PMS) also known as petrol were reduced during the first quarter of 2020, marketers waited and, in most cases, deliberately foot-dragged before they could change their pumps to reflect the new price.

 

Their explanation? The stocks (of petrol) they had in their tanks must be sold out at the old (high) price first before the new (low) price woukd take effect. And, for the period of the year in which the prices have been raised, the reactions to price adjustment by marketers have been different.

 

Just last Friday, the price of petrol was raised to as high as N170 per litre, highest in the history of Nigeria, the same day troubled crude oil market buoyed by declining prices and second wave of COVID-19 in Europe and America forced down prices of crude oil to $40 per barrel at the international market.

The PwC in a reaction to the lower crude oil price noted in a report entitled; “Africa oil and gas review 2020” that the pandemic had caused the worst oil industry crisis in history and that oil demand will likely never recover to prepandemic levels.

 

“With the oil price at approximately $40 per barrel, oil-exporting countries will experience longterm decline in their export revenues as a result of the renewed weakness in global oil prices, coupled with the accelerated transition to renewables in key importing countries,” the report read.

 

While the price of crude struggles below budget, the Pipelines and Products Marketing Company (PPMC), hiked the ex-depot price of petrol to N155.17 per litre through a memo which later went viral. Before this action by PPMC, a subsidiary of the Nigerian National Petroleum Corporation (NNPC), the ex-depot price of petrol was N147.67 per litre.

 

NNPC clarifies

 

The NNPC in a statement, however, clarified that although there was a slight increase in the price based on the prevailing realities of market forces of demand and supply, the correct prices, as can be seen on PPMC’s “Customer Express” platform (online portal for procurement of petroleum products) are: Ex-Coastal Price – N128, and Ex-Depot Price (with collection) – N153.17.

A statement by the Group General Manager, Group Public Affairs Division, NNPC, Dr. Kennie Obateru, advised marketers to make their purchases through the online “Customer Express” platform (PPMCCustomer. Express/ login/authenticate) at the recommended prices. Depending on the marketer involved or the proximity of their filling stations to the loading depot, there is always a differentials of between N12 and N15 between the ex-depot price and the pump price.

 

Maketers taking the ‘Nigerian” way Some markters did not wIth for this clear position and direction from NNPC before they jump at profiteering opportunity the earlier announcement has created. This makes the N155.17 controversial ex-depot price to shots up the expected pump price to as high as N170 per litre.

 

The ex-depot price is the price at which the product is sold by the PPMC to marketers at the depots. In its PMS price proposal for November, the PPMC put the landing cost of petrol at N128.89 per litre, up from N119.77 per litre in September/ October. It said the estimated minimum pump price of the product would increase to N161.36 per litre from N153.86 per litre.

 

The National Operation Controller, Independent Petroleum Marketers Association of Nigeria, Mr Mike Osatuyi, in a telephone interview with our correspondent, said the over N7 increase in ex-depot price would translate into an increase in pump prices. He said: “Like I told your colleague who called me earlier, there is going to be an increase in the pump price. We are expecting the pump price to range from N168 to N170 per litre.”

 

Meanwhile, refiners around the world have been announcing permanent closures of refinery capacity this year after the pandemic crushed fuel demand worldwide, and significant overcapacity still remains, the International Energy Agency (IEA) said at the weekend In its monthly Oil Market Report, the EIA said that permanent shutdowns of refinery capacity had reached 1.7 million barrels per day (bpd).

 

Kano IPMAN sells at N170 The Independent Petroleum Marketers Association of Nigeria (IPMAN), Kano State branch, directed its members across the state to sell petrol from N168 to N170 per litre.

 

The state’s Chairman of the IPMAN, comprising Kano, Bauchi, Jigawa and the Katsina states, Bashir Dan- Mallam, while addressing journalists, said the association heeded to PPMC advice for the upward review of the pump price of petrol as contained in the circular.

 

He said: “I call on all our members within our branch to immediately change the price of their litres from N160 per litre to between N168 and N170 per litre. “This development came after we received a circular from PPMC, advising us on the upward review of the price after it reviewed the market fundamentals gorgeous the month of November 2020.”

 

Swift action in Lagos, Kaduna on adjustment of pumps Many filling stations in Lagos and Ofun state did not bother to wait for any directive.

 

Unlike how they usually delay action when the price is reduced, they swiftly adjusted their pump and started selling the product at N168 per litre. In Kaduns many stations shut their gates while others immediately began to sell the product at N160 in Kaduna As gathered by New Telegraph, many filing stations in Kaduna are now under lock and key.

 

This follows another increase in the pump price of petrol across the country. This is as some others are still selling at the old price, while many of the filling stations visited by our correspondent were still selling at N160 per litre. It was gathered that many that were selling earlier in the morning had closed their door to customers.

 

Some of those that were not selling include Oando filling station, Vine filling station and the NNPC retail outlet all along Kachia road in the southern part of Kaduna metropolis.”

 

Reactions from across the nation Frontline socio-cultural and political groups, Afenifere, Ohanaeze Ndigbo, Arewa Youth Forum (AYF), the Peoples Democratic Party (PDP) faulted the announcement by the Petroleum Products Marketing Company (PPMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC), that it had increased the ex-depot price of Premium Motor Spirit also known as petrol), to N155.17 per litre from N147.67 per litre.

 

The organisations condemned the new price increase, insisting that the Federal Government was insensitive to the plight of Nigerians, given the recent increase in electricity tariff, COVID-19 pandemic, #EndSARS protests, among other “unfavourable” economic policies.

 

The Minister of State for Petroleum Resources, Timipre Sylva, had said in September that the Federal Government had stepped back from fixing the price of petrol, adding that market forces and crude oil price would continue to determine the cost of the product. Recall that the PPMC had in an internal memo dated November 11, 2020, and signed by Tijjani Ali, said the new ex-depot price would take effect almost immediately.

 

The ex-depot price is the price at which the product is sold by the PPMC to marketers at the depots. In its PMS price proposal for November, the PPMC had put the landing cost of petrol at N128.89 per litre, up from N119.77 per litre in September/October. It said the estimated minimum pump price of the product would increase to N161.36 per litre from N153.86 per litre.

 

Afenifere: It’s unjust on Nigerians However, Afenifere in its reaction, berated the Federal Government- led All Progressives Congress (APC) over the hike in the pump price of petrol.

 

The group, which fumed over the development, stated that the increment was unjust on Nigerians, who had been stretched beyond limit. Afenifere’s Publicity Secretary, Yinka Odumakin, said the move would further heighten the hardship Nigerians had been subjected to since the inception of the President Muhammadu Buhari-led administration.

 

Ohanaeze Ndigbo chides FG Ohanaeze Ndigbo lashed out on the Federal Government for the latest increase in pump price of pet-rol. Reacting to the increment, the group’s Deputy National Publicity Secretary, Chuks Ibegbu, said it was a shame that Nigeria, which is about the highest oil producer in the world was still exporting crude oil and importing refined products.

 

Ibegbu said: “It is a shame that Nigeria produces oil, that God richly blessed with oil and gas is making unaffordable to Nigerians and the people, its a shame for the leadership of this country from the president to the blast people that are leading this country that Nigerians cannot enjoy their God-given resources. “It is a shame to all of them that they cannot allow Nigerians to enjoy their God-given product.

 

They take crude oil to foreign land to refine them, bring them here and they pay oil subsidy to criminals, they allow criminals to control the entire process.”

 

Govt insensitive-Arewa youths

 

The National President of the Arewa Youth Forum (AYF), Gambo Ibrahim Gujungu, also described the increase in the pump price of petrol as insensitive.

 

Gujungu told New Telegraph that “President Muhammadu Buhari is insensitive to the plight of Nigerians.

 

With so much suffering in the land, this administration still has the impudence to increase the price of fuel at a time like this. “I believe there is a disconnect between this administration and the Nigerian people. While the government is saying something, the people of seeing a different thing entirely.

 

“The government needs to know the level of suffering in the country and come up with the needed antidote to tackle the problem head on before it degenerates into something else.

 

“Government needs to come up with measures to cushion this level of suffering and deprivations and not fuel increase.”

 

Last line

 

The Federal Government’s promises on deregulation, which include a competitive market that would, in return, force down the prices of petrol, is under threat caused by profiteering.

 

This bad business principle must, however, be eschewed by a cross section of marketers involved in it.

 

 

 

TRY IT TONIGHT!!! ---

 

Abuja Civil Servant reveals (FREE) secret Fruits that Increased his Manh0d size, gives Stronger Erections and ends Premature Erection in 7days...

   

CLICK HERE FOR FULL DETAILS.

 

%d bloggers like this:
Fake Richard Mille Replica Watches, www.richardmille.to The ceramic upper and lower cases are imported from Taiwan and are processed by ATPT ceramics to form Y-TZP ceramics. After high-tech anti-fingerprint technology, they present a delicate and soft sub-black material. This color quality has remained unchanged for a hundred years. The color and luster are more detailed to achieve the ceramic tone visual pattern electroplating upper and lower shells that are infinitely close to the original products, with anti-reflective coating sapphire glass! The tape uses a soft and delicate Malaysian imported top rubber strap, and the movement is equipped with an imported Seiko NH movement. The buckle of this version is made according to the original size and thinness, making it feel more comfortable and intimate, the highest version on the market Richard Mille Replica