Newscenter Media News The Federal Government, on Wednesday, distanced itself from the recent hike in petrol prices, which has sparked widespread outrage across Nigeria.
Minister of Information and National Orientation, Mohammed Idris, in an interview with Daily Trust clarified that the government was not responsible for the increase, instead pointing to the Nigerian National Petroleum Company Limited (NNPCL) and global market forces.
The NNPCL recently raised petrol prices across various regions, with Abuja seeing a hike from N897 to N1,030 per litre, Lagos from N855 to N998, and other regions experiencing similar increases. This move has prompted calls from Nigerians for President Bola Tinubu to intervene and reverse the increment.
Idris explained that the NNPCL’s decision was a response to prevailing circumstances in the energy industry, emphasizing that the company acted independently without government instruction. He cited the Petroleum Industry Act (PIA) as the basis for the government’s non-interference in price fixing.
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“The differential you’re seeing is a result of different factors. One of them is the crisis in the Middle East. There’s volatility in the market. Therefore, the prices of petroleum products are going up, consistent with what is happening with other operators in the industry globally,” Idris stated.
He added that the NNPCL can no longer absorb losses due to its status as a limited liability company. The minister urged Nigerians to show understanding, assuring that prices would eventually decrease.
However, the Nigeria Labour Congress (NLC) has rejected the price hike, arguing it will deepen poverty and lead to job losses. NLC President Joe Ajaero criticized the government, saying, “It looks like the only thing this government is known for is an increase in the pump price of petrol without commensurate capacity of Nigerians or mitigatory measures.”
Key Factors Behind the Price Hike:
– Global Market Volatility: Crisis in the Middle East affecting petroleum prices
– NNPCL’s Limited Liability Status: Company cannot continue to absorb losses
– End of Subsidy Regime: NNPCL had been paying differential to maintain prices since May 2023
Earlier, the Nigerian National Petroleum Company (NNPC) Limited had increased the price of premium motor spirit (PMS), also known as petrol, across its retail outlets.
NNPC had earlier increased the pump price from N855 per litre set in September.
The price development comes weeks after the NNPC commenced petrol lifting at the Dangote Petroleum Refinery’s gantry after an extended period of price negotiations.
On September 15, the NNPC said petrol was bought from Dangote refinery at N898 per litre.
The Dangote refinery countered NNPC’s claim, describing it as “both misleading and mischievous”.
A day after, the national oil company announced estimated pump prices based on prices set by the Dangote refinery for its petroleum products, saying petrol will sell for N950 in Lagos and N999 in Abuja.
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