Fuel marketers warn of a petrol price hike and urge FG to subsidise crude sales to local refineries to shield consumers

Petroleum product marketers in Nigeria on Monday warned that a fresh petrol price hike could severely impact consumers unless the Federal Government moves to subsidise crude oil supplied to domestic refineries, including the Dangote Petroleum Refinery.

Also read: Dangote refinery–marketers petrol deal collapses over pricing

The call was made by the Independent Petroleum Marketers Association of Nigeria, which appealed to President Bola Tinubu to sell crude oil to local refiners at subsidised rates and extend the naira for crude arrangement to modular refineries across the country.

The intervention followed a recent increase in petrol prices after the Dangote refinery raised its gantry price, pushing pump prices at several filling stations in Lagos and other cities above N830 per litre.

Speaking on the development, the IPMAN National Publicity Secretary, Mr Chinedu Ukadike, said a subsidised crude oil framework had become critical to cushioning Nigerians from the shock of volatile global oil prices.

Mr Ukadike said fluctuations in crude oil prices directly affect the cost of petrol, diesel, and other refined products, noting that recent movements in the international market had heightened pressure on local pricing.

According to Mr Ukadike, the Federal Government should offer domestic refiners a special pricing arrangement on crude oil to act as a buffer against sudden price increases.

He said selling crude to refineries in naira at subsidised rates would help stabilise pump prices even when global oil prices rise.

Mr Ukadike said the recent request by the Dangote refinery for marketers to top up payments by N100 per litre was triggered by rising crude prices, stressing that the situation highlighted the need for urgent policy intervention.

Last week, global crude prices climbed above $70 per barrel, fuelling concerns that petrol prices in Nigeria could rise to as much as N1,000 per litre, particularly in areas far from refineries and major fuel depots.

The Dangote refinery had earlier increased its gantry price of Premium Motor Spirit from N699 to N799 per litre, a move that pushed its ex depot price about N70 above the landing cost of imported petrol.

Findings showed that marketers who had completed payments at the old rate were later asked to make additional payments before loading, following the withdrawal of temporary price support and the cancellation of earlier loading approvals.

Following the adjustment, filling stations across the country reviewed their pump prices.

In Lagos, petrol sold for between N830 and N859 per litre, while the Nigerian National Petroleum Company Limited dispensed the product at N849 per litre along the Lagos Ibadan Expressway.

MRS stations sold petrol at N839 per litre, with a few outlets offering slightly lower prices.

Mr Ukadike said fuel consumption had slowed noticeably since the increase, with consumers becoming more cautious in their purchasing habits compared with the December festive period.

He warned that unless crude oil prices fall to around $60 per barrel, upward pressure on petrol prices would persist, adding that exchange rate movements also play a decisive role in domestic fuel pricing.

Also read: Dangote refinery challenges marketers amid petrol hike

Mr Ukadike said a sustained rise in crude prices would weaken marketers’ purchasing power and inevitably translate into higher pump prices nationwide, describing the situation as a mounting strain on both businesses and households.