Market forces driving up petrol prices, says NNPC as Fuel stations adjust petrol pump price to N617 in Abuja, N565 in Lagos 

By Fatai Ahmed

Mele Kyari, the group chief executive officer of the Nigerian National Petroleum Company (NNPC) Limited, said

 market forces  are responsible for the increase in petrol pump price from N540 to N617 per litre.⁣

 Petroleum product’s pump price mid Tuesday morning, had gone up to N617 per litre in the federal capital territory (FCT) and N568 a litre in Lagos.

However, speaking with state house correspondents  after a meeting with Vice President Kashim Shettima at the Aso Villa on Tuesday, Kyari said the increase is not based on a short supply of petrol. ⁣

“They are just prices depending on the market realities. This is the meaning of making sure that the market regulates itself. Prices will go up and sometimes they will come down also,” he said.

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“No, there is no supply issue. It is not a supply issue.⁣

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“When you go to the market, you buy the product, you come to the market and sell it at its prevailing market price. It has nothing to do with supply. We don’t have supply issues. ⁣

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“We have a robust supply. We’ve had over 32 days of supply in the country. That’s not a problem.”

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On his part, ⁣Farouk Ahmed, chief executive officer (CEO), Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), said the price hike was a result of rising crude prices. ⁣

He also attributed the increase to changes in freight rates as well as other ancillary expenses importers incur during distribution.

“So when you say market forces are working, basically what it is, is that you can see the price of crude going up,” he said.

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“A week or so ago, the price of crude was hovering around $70 per barrel. Now, it’s over $80 per barrel. So, of course, the crude prices also drive the product price.⁣

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“As the importers are importing, they base it on the cost of importation plus the freight plus other costs elements in terms of local distribution.”

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In his inaugural address on May 29, President Bola Tinubu pronounced that the petrol subsidy is gone.

Subsequently, NNPC increased the price of petrol at its retail outlets to N537 per litre in Abuja and N488 in Lagos

Meanwhile, Oil marketers, on Tuesday, increased the pump price of petrol at retail outlets to N617 per litre in Abuja and N565 per litre in Lagos.

 The product’s new cost differed significantly from the previous pump price of N537 per litre in the federal capital territory (FCT).

The Cable, an online publication reported that at Emadeb filling station in Mabushi, the price of the product rose to N617 per litre.

A fuel attendant at Emadeb disclosed that she was not aware of the increase until “few minutes ago when they changed the price on my meter”.

In Lagos, the price of the product oscillated from one location to the next. Petrol sold at N488 per litre at the NNPC retail outlet in Ejigbo.

However, the NNPC outlet at Apple junction, Amuwo Odofin, is currently dispensing at N568 per litre.

At TotalEnergies filling station in Alakija, petrol sold for N565 per litre — up from the previous price of N500 per litre.

At Peridot filling station, along Festac link road, the price of the product increased from N500 per litre to N565 a litre.

The development comes few months after the complete deregulation of the downstream petroleum sector.

Deregulation is the elimination or removal of government controls over a sector, allowing market forces to determine the prices of products.

On May 29, President Bola Tinubu announced that “petrol subsidy is gone” — a pronouncement which immediately led to a hike in the pump price of the product across the country.

Transport costs soared by over 100 percent in the wake of the president’s inaugural speech