The Petroleum Products Pricing Regulatory Agency (PPPRA), has said the pricing template of Premium Motor Spirit (PMS) otherwise known as petrol, would soon be reviewed to protect consumers from being overcharged.
Executive Secretary of PPPRA, Abdulkadir Saidu, who made this known over the weekend in Abuja, noted that the last review was carried out about four years ago.
While noting that guidelines for Petroleum Products Commercial Framework has been concluded and Code of Conducts for Operators was currently being firmed-up to reflect the present price regime, he revealed that a regulation on the PMS market-based pricing regime has been put in place in collaboration with Office of the Honorable Minister of State for Petroleum Resources and Office of the Attorney-General of the Federation.
In his words: “Transitioning to a fully deregulated market comes with its growing pains. Major challenges witnessed during the transition period which impacted PMS pricing include: holding stock of products bought at higher prices, non-availability of foreign exchange for importation of petroleum products and slow depletion of stock due to the COVID19 pandemic. These challenges are currently being managed.
“On a positive note, the PPPRA is currently finalising the review of cost elements and profit margins on the pricing template for marketers to reflect the current market-driven pricing regime, which was last reviewed in 2016 while ensuring that consumers are not overcharged.”
The PPPRA boss while explaining that the Agency does not fix prices but rather, provide a monthly guiding price band reached through a daily monitoring of Petroleum products, maintained that the new pricing regime do not only encourage marketers to resume supply of PMS, but has further lead to a value creation in the downstream sector.
“This policy will foster job creation, ensure reasonable returns for investors, create healthy competition among marketers, enhance value for consumers and make funding available for other important infrastructure.
“The PPPRA had earlier emphasized that the new pricing regime is a market-reflective pricing system where the Agency advises marketers on guiding price.
“It is pertinent to also note that although crude oil price and petroleum products prices are positively correlated, the prices of petroleum products do not increase or reduce correspondingly with changes in crude oil price. The pump price we expect to see will be a reflection of the international market prices of petroleum products that are also rising.”