Mele Kyari, the group chief executive officer of the Nigerian National Petroleum Company (NNPC) Limited, has shed light on the recent increase in petrol pump prices, attributing it to market forces rather than a supply shortage. The pump price of petrol rose from N540 to N617 per litre in the federal capital territory (FCT) and N568 per litre in Lagos.
After meeting with Vice President Kashim Shettima at the Aso Villa, Kyari explained that the price surge was a result of market dynamics. He emphasized that prices are subject to fluctuation as the market regulates itself, responding to various factors. At times, prices go up, and at other times, they may come down.
Kyari further clarified that the increase was not due to a lack of supply, assuring that there is a robust supply of petrol in the country, with more than 32 days' worth of supply available.
Additionally, Farouk Ahmed, chief executive officer (CEO) of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), pointed out that the price hike was influenced by rising crude oil prices. As the cost of crude oil escalated from around $70 per barrel to over $80 per barrel, it naturally impacted the pricing of petroleum products. Moreover, importers factored in various expenses, including freight costs and distribution-related charges, while setting prices.
It's worth noting that President Bola Tinubu had earlier announced the removal of petrol subsidies during his inaugural address on May 29. Consequently, NNPC adjusted petrol prices at its retail outlets to N537 per litre in Abuja and N488 per litre in Lagos.
As petrol prices continue to be influenced by market dynamics, consumers are advised to be aware of these fluctuations and understand the various factors that contribute to changes in pump prices.
