In the long run, may Nigeria win! This is the expectation since the emergence of this administration led by President Bola Ahmed Tinubu, and it may not be far from reality as reports has the Nigerian National Petroleum Company Limited considering to slash premium motor spirit price, following the reduction in the same by MRS filling station via a pact with Dangote Refinery on Monday.
Healthy competition is good for business, the people will benefit from it in the long run. Looks like the NNPCL has now moved from the era of monopoly, and now being made to operate an oligopoly, as the National President, Petroleum Products Retail Outlet Owners Association, Billy Gillis-Harry, and Spokesperson for Independent Petroleum Marketers Association of Nigeria, Chinedu Ukadike, made this known as reported by Dailypost.
This revelation may not be far from the announcement made by MRS filling station yesterday of fuel price reduction, for the first time in 2025.
MRS stated on Monday in its official X account that its pump price had dropped to N925 per litre in Lagos, South West (N933), North (N945), and South-East (N955). The new per litre price drop is from around N970 previously sold by the company.
This comes weeks after Dangote Refinery, on February 1, 2025, announced an ex-depot price drop to N870 from N970 per litre.
And of course, you won’t expect NNPCL to be an onlooker following the MRS announcement, hence the immediate reaction by Gillis-Harry and Ukadike of NNPCL, who maintained that in the coming days, it would take after MRS and declare PMS price reduction to remain relevant in the country’s downstream sector.
Gillis-Harry said that “NNPC has no choice but to reduce petrol retail prices because it is not possible to see a product at a cheaper price and still go for NNPCL.”
Similarly, Ukadike explained that since the price war between Dangote Refinery and NNPCL persists, the latter cannot afford to do anything other than a price reduction.
“It is likely that NNPCL will drop its price because there is a price war with Dangote Refinery. Once Dangote Refinery announces a price drop, NNPC will follow suit,” he said.
Measuring the impact of petrol price reductions on transportation costs, others
Despite the recent petrol price reduction by MRS filling stations, Gillis-Harry noted that the cost of transportation and food prices have remained stagnant.
According to him, the weak purchasing power of Nigerians is the major reason the fuel price reduction is not impacting food prices and transportation costs.
“If you watch, the cost of transportation has not reduced in spite of the reduction of fuel at the retail market. That tells you that the purchasing power of Nigerians is very weak.
“In my opinion, we need to engage Nigerians in production activities such as farming, fishing, and technology.
“Go to the park, you will see that the price of transportation cost has not been impacted by the fuel reduction,” he stated.
However, Ukadike said that the impact of the petrol price reduction will be felt on transportation, goods, and services in the long run.
“The impact will be gradual; it will eventually impact transportation and others,” he noted.
Should you worry over frequent petrol price adjustments?
Gillis-Harry frowned at the frequent adjustments of petrol price by actors in the oil and gas sector.
He noted that incessant price adjustments will affect petrol security.
He added that arbitrary petrol price hikes cause serious losses to marketers who might lift fuel stock before the arrival of new stock.
“There was a lot of fuel that was purchased at the old price that is still in the system, and they have not been sold.
“Marketers cannot sell below the cost price. It is completely impossible for someone to buy a product at N970 per litre and sell below the purchase price.
“MRS that is trying to deepen the distribution process with PETROAN and Dangote Refinery still has the same challenge of the buying power,” he deduced.
It’s not news anymore that the back and forth of petrol price was tense in 2024, when Dangote Refinery had slashed its petrol ex-depot price from N899.50 per litre to N97, while NNPCL also announced a PMS price drop to petroleum markets, last
The price rivalry between NNPCL and Dangote pushed fuel prices down in the last lap of 2024.
