NNPC Ltd Confirms Deregulation of Petrol Prices, Announces Significant Crude Oil Supplies to Dangote Refinery Amidst Fuel Scarcity Concerns
In a statement released on Thursday in Abuja and signed by Chief Corporate Communications Officer Olufemi Soneye, the company announced that product prices would now be determined by market forces. This update follows the recent start of petrol refining operations by the Dangote Refinery earlier this week.
According to Adedapo Segun, Executive Vice President of Downstream at NNPC Ltd, the downstream sector has been fully deregulated, and as a result, the company will no longer set prices. This clarification addresses previous speculations that NNPCL might continue to control prices despite the deregulation of the sector.
Recent speculation about NNPCL being the exclusive buyer of petrol from the Dangote Refinery has been addressed by the Nigerian National Petroleum Company Limited (NNPC Ltd). In a statement released on Thursday in Abuja, Chief Corporate Communications Officer Olufemi Soneye clarified that product prices would now be set by market forces, as stipulated by the Petroleum Industry Act (PIA).
The statement highlighted that foreign exchange (forex) illiquidity has significantly impacted the fluctuation in Premium Motor Spirit (PMS) prices. NNPCL emphasized that these price fluctuations are governed by the free market, in accordance with the PIA.
Adedapo Segun, Executive Vice President of Downstream at NNPC Ltd, also noted that the current fuel scarcity is expected to ease within a few days as more fuel stations recalibrate and resume PMS sales. He reaffirmed that Section 205 of the PIA mandates that petroleum prices are determined by unrestricted market forces.
Adedapo Segun, Executive Vice President of Downstream at NNPC Ltd, stated that with the deregulation of the market, petrol prices are now set by market forces rather than by the government or NNPC Ltd. He also noted that the exchange rate significantly impacts these prices.
Regarding the commencement of petrol lifting from the Dangote Refinery, Segun mentioned that NNPC Ltd is awaiting the refinery’s September 15th timeline.
Addressing concerns over the current fuel scarcity, Segun acknowledged that it is troubling but assured that NNPC Ltd, with nearly a thousand filling stations across the nation, is working with marketers to keep stations open longer to ensure a steady fuel supply. He added that efforts are underway to prevent product diversions and ensure timely deliveries, with the expectation that the scarcity will ease in the coming days as more stations recalibrate and resume operations.
Segun’s clarification follows the Federal Government’s recent announcement that a significant supply of petrol would be available over the weekend, as vessels have begun offloading. However, the government also confirmed that it would not be involved in fixing the prices of Premium Motor Spirit (PMS).
NNPC Ltd Announces Crude Oil Supplies to Dangote Refinery and Addresses Fuel Pricing Concerns
NNPC Ltd has announced that it has already supplied approximately 30 million barrels of crude oil to the Dangote Refinery and plans to deliver an additional 17 million barrels soon. The company will provide 6.3 million barrels in September and 11.3 million barrels in October. The September supply will be delivered in seven cargoes.
Despite these substantial deliveries, NNPCL expressed concern that current petrol pump prices do not reflect market realities. Segun highlighted that the current situation, where NNPCL is the sole importer of Premium Motor Spirit (PMS), is not ideal. He emphasized that fuel prices should be driven by market forces rather than being influenced by a single entity.
Segun clarified that NNPCL’s role as the sole importer of petrol was not a strategic choice but a response to reduced participation from other market players. He stated, “NNPC is not a regulator. We didn’t choose to be the sole importer; we stepped in as others scaled back their involvement. It’s not about us wanting to be monopolists.”
He also noted that achieving stable fuel supply and pricing requires optimal market conditions, including improved foreign exchange liquidity. Segun indicated that broader economic reforms might be necessary to address the fuel pricing issues.
Once the Dangote Refinery begins rolling out PMS and NNPC Ltd starts lifting, further details will be communicated, Segun added.
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