Nigerians have commended the reduction in pump price of petrol by the Nigerian National Petroleum Company (NNPC) Limited.
This is even as Lagosians voiced their frustrations as many filling stations in the city continued to sell the commodity at the old rate, while the NNPC Ltd with fewer outlets, compared to others, have slashed their prices.
The NNPC Ltd had cut down the price of a litre of petrol from N1, 060 to N1, 030 before further reducing it to N965 per litre.
Also, Dangote Refinery announced similar reduction in the pump price of its products.
…Reactions
Other stations that spoke Monday with Blueprint Newspapers said they needed to exhaust their old stock before lowering prices.
Also, a cross section of people who spoke with this medium commended the state-owned oil company, describing the price reduction as good news.
In his comment, President Nigerian Economic Society (NES), Professor Adeola Adenikinju said: “The reduction in fuel price by the NNPC is commendable.
“Competition in the industry is bringing down prices as Dangote Refinery has also lowered price. This is one of the benefits of the deregulation of the sector and the removal of fuel subsidies.
“I am hopeful that as we remain on course in the implementation of the subsidy removal, the sector will witness more refineries and more investments to the downstream petroleum sector, the more the Nigerian economy and the people would benefit from the liberalization. The NNPC pricing decision is good for the economy, and it is commendable. I hope the trend will continue.”
‘…Impacts may not be soon’
Other speakers were, however, quick to add that Nigerians would not immediately begin to feel the impact of the pump price reduction.
A consumer rights advocate, Aliyu Ilias, hailed the NNPC Ltd for the reduction describing it as good news.
According to Ilias, the pump price reduction is as a result of competition.
“However, it is a function of competition that is why we always want competition that will open doors to more competition in the oil and gas industry. We should continue to allow importation while Dangote is pumping prices doing its best while local refineries come up gradually.
“The reduction we are seeing now is the work of competition. Saudi Arabia has about five refineries and they still import fuel, America has 132 refineries they still import fuel just to make sure that there is stability and competition. Competition will reduce the price and it will be to the benefit of the citizens,” he said.
Ilias stressed that Nigerians will not immediately begin to feel the impact of the price reduction as it has to be consistent for few months.
“Can this basic reduction show in the economy? The answer is no. Before Nigerians can see the benefits of the reduction, it has to be consistent over time. If it is consistent for like two or three months, the benefits will be felt by everyone because what people are using, they must have purchased before now.
“The major thing is the transport system. It has a multiplier effect until it shows in the transport system. And you know it is not regulated. That is why most of us are saying CNG will solve the problem. If it is available that is what will have a significant impact. To have a significant impact, we must talk about a N300 reduction that is it must come down to about N600 or N700 per litre. For now, we can’t see that reflecting,” he further said.
‘…Demand and supply at work’
On his part, Olamilekan Adefolarin, a financial analyst said Nigerians were beginning to see marginal price reflection due to the forces of demand and supply at play.
The economist was however quick to note that the marginal price reduction will not reflect on transportation as many are expecting.
“The reason is that the old stock price will still be maintained by many petrol stations and going by the challenge of price distortion of the product over the years, cost of transportation will still be high, given the other logistics burdens by petrol stations as running expenses.
“We hope this can be sustained especially as competitive price is what will actually bring about lesser losses to NNPC in terms of avoiding low margin profit,” Adefolarin added.
‘…Transportation won’t be affected for now’
At the Nyanyan motor park, a commercial driver told Blueprint that the price reduction would not affect amount being charged by transporters.
Ejike, who plies the Nyanya-Berger route, noted that with the price of spare parts constantly on the rise, it will be difficult to talk about cutting down on the amount that is charged by motorists.
According to him, the union will have to meet to agree on the right amount that will be charged.
He said: “This reduction is not enough for it to affect transport costs. We must not forget that not all filling stations are selling at the new price. And also, when you consider the cost of spare parts, you will understand why the amount passengers pay will not come down.
“We are waiting for the union. When they meet, whatever they agree on will reflect on the amount we will charge.”
…Old prices on parade
However, when one of Blueprint reporters visited AP at Gowon Estate, Egbeda, Lagos, the product was selling at N1, 025 per litre.
The staff assured that they will begin to sell at the new stock after exhausting the old stock.
The directive, issued last week, aimed to bring relief to consumers amid rising economic challenges, by reducing the ex-depot price of petrol to N899 per litre.
However, pump prices at many stations remained unchanged.
While some NNPCL outlets in Lagos have adjusted their rates to N970 per litre, the majority of independent marketers are still selling petrol at N1, 025 per litre.
According to station managers, this delay in implementing the price reduction is due to existing stock purchased at the previous higher rates.
“We still have old stock, which we bought at the old price,” explained a manager at an AP filling station in Lagos, adding, “once that is sold, we will adjust the price to reflect the new directive from NNPCL. This should happen by next week.”
…Motorists, commuters express dismay
The situation has led to mixed reactions from the public. Motorists and commuters, who were hopeful for immediate relief, have expressed disappointment.
“I don’t understand why some stations are still selling at higher prices when others have already reduced theirs,” lamented Chukwuemeka Nnadi, a Lagos-based driver, adding, “it feels like they are just looking for excuses to keep profiting at our expense.”
…PETROAN weighs in
Meanwhile, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has weighed in on the matter, defending the retailers.
“Some of these stations still have fuel stock bought at higher prices, and it’s not practical to sell at a loss,” said Billy Gilly-Harry, PETROAN’s president.
“Once the new stock, acquired at reduced rates, is available, the new pricing will take effect,” he added.
…Hoarding in the horizon
In addition to consumer dissatisfaction, reports of hoarding have emerged, with some filling stations accused of withholding fuel supplies in anticipation of potential price fluctuations.
This has exacerbated the situation, resulting in long queues and heightened tensions at several outlets.
Economists have called for stricter regulatory oversight to ensure compliance with the NNPCL directive and prevent exploitation.
“Uniformity in fuel pricing is critical to avoid unnecessary disparities and ensure fairness for all consumers,” said Dr. Bisi Adeyemi, a Lagos-based economic analyst.
While Lagos has seen a sluggish response to the directive, reports indicate that other cities such as Ibadan, Port Harcourt, and Kano have witnessed better compliance.
However, the extent of price adjustments varies by location, raising concerns about nationwide consistency.
As the NNPCL continues to monitor the situation, many Lagosians remain hopeful that the promised price reductions will soon take effect across all outlets.
Until then, the uncertainty over fuel pricing continues to be a major concern for residents navigating an already challenging economic landscape.
…It’s welcome development – Jide Ojo
Also in a reaction, a public affairs analyst, Mr Jide Ojo, said the fuel reduction is a welcome development that President Bola Ahmed Tinubu and the authorities said the price of fuel will not be static.
He said, “the presumption is that whatever goes up does not come down but that have been proven wrong and now we know that what goes up can come down even if it’s a fraction.”
According to him, the price could go down to N500 per liter so that the effect will be better felt rather than marginal reduction which may not amount to much for consumers.
He further said that with the CNG initiative which was recently launched, better and most economical options abound for Nigerians.
According to him, people now have choices to make either to opt for CNG or PMS, “and this plurality in the coming years demonstrates to the reduction in prices across the country.”
“I hope that in 2025 there will be a lot more refineries coming on stream, particularly modular refineries such as the one BUA is doing in Akwa Ibom state and others and Nigerians will now feel a better days ahead,” he said.
…CISLAC
Also, Executive Director Civil Society Legislative Advocacy Centre (CISLAC) Auwal Ibrahim Musa (Rafsanjani) said the fuel reduction will reduce the difficulties that Nigerians were facing.
He expressed the hope that further reduction will happen because “Nigeria is an oil producing country and we can’t be buying oil as if we don’t have resources.”
Going forward, he called on the federal government to eliminate corruption in the oil and gas sector, mining sector and also oil theft.
All these, if not curbed, he said, will be difficult for oil to be produced in Nigeria.
“Attention should be shifted to the illegal mining because that is what is affecting the oil revenue in the country”, said Rafsanjani.
