Marketers import 536,000 metric tonnes of fuel in four months

Marketers imported 536,000 metric tonnes of petrol since the deregulation of the downstream sector on March 19, 2020, the Petroleum Products Pricing Regulatory Agency (PPPRA) disclosed yesterday.

The agency’s Executive Secretary, Abdulkadir Saidu, in a statement in Abuja, said the dealers had also indicated interest to vend automobile gas in their retail outlets nationwide.

He pointed out that the oil marketing companies (OMCs) had in the past years quit the importation chain owing to the existence of the subsidy regime.

Saidu said following the commencement of the new price administration heralding the full deregulation of the industry, a “considerable increase in the level of OMCs’ participation in PMS importation has been recorded.”

He explained that the policy was to enable the players to operate within acceptable limits and protect consumers, among others.

The PPPRA chief acknowledged the public outcry trailing the recent surge in prices of petroleum products, explaining that the decision was a reflection of the new market-based pricing system, “which does not seek to harm consumers, but foster growth in the sector, and prevent wastages resulting from the subsidy.”

Consistent with the new reality, he reiterated that the agency no longer fixes prices, but provides a guiding band by monitoring prices daily and using the average value of the previous month to determine the charge for the one, while ensuring reasonable returns to OMCs.

He rationalised that in the prevailing era, prices are determined by market forces, giving vent to the recent downward and upward movements in the guiding pump price band of petrol.

Saidu stated: “Correspondingly, if the price of crude oil is low, it stands to reason that pump prices will come down, and similarly when prices increase, pump price will also go up. In the same vein, foreign exchange (Forex) rates also guide the pump prices of petroleum products. Its availability to importers is very essential in determining the Expected Open Market Price (EOMP) of products.”

He added that PPPRA was working with the Central Bank of Nigeria (CBN) to determine an applicable forex rate for the importation of petroleum products and the modalities to accessing the window.

This, according to him, was to protect the consumers from exorbitant prices that could arise from a higher exchange rate.

Saidu said more investments in local refining were gaining traction to engender competitive pricing.