Oil Marketers Raise Petrol Price (see new price)

The rising cost of Premium Motor Spirit (PMS) and diesel loading at depots is causing concern over potential increases in pump prices nationwide.

This development, attributed primarily to surging crude oil prices, is expected to affect consumers and businesses alike.

Key Points of the Price Increase

  1. Depot Price Adjustments:
    1. PMS (Petrol): Loading prices have risen across several depots by ₦43 to ₦52 per litre, with rates now ranging from ₦945 to ₦960 per litre, depending on the location.
    1. Diesel: Loading costs increased by ₦72 to ₦100 per litre, with prices at depots now between ₦1,120 and ₦1,150 per litre.
  2. Contributors to the Price Hike:
    1. Brent Crude Surge: Brent crude oil, the global benchmark, climbed to $79.76 per barrel, driving up refining and importation costs.
    1. Refinery Pricing: Marketers purchasing from Dangote Refinery at ₦899 per litre for petrol now resell to retailers at ₦923, further inflating costs down the supply chain.
  3. Implications for Consumers:
    1. Pump Prices: Higher depot prices may lead to increases in pump prices across the country.
    1. Volatility: Experts, including oil and gas analyst Olatide Jeremiah and marketer Bayo Adelaja, warn of continued price fluctuations, driven by crude oil prices and market instability.

Broader Concerns

  1. Inflationary Pressure: Rising fuel prices are likely to drive up transportation and production costs, further exacerbating inflation.
  2. Economic Burden: Consumers may face higher costs for goods and services, adding to existing economic challenges.
  3. Government Intervention: There is no immediate indication of government action to stabilize prices or provide subsidies to ease the burden on Nigerians.

Industry Expert Commentary

Olatide Jeremiah explained that the increase is directly linked to the crude oil market:

“A large chunk of oil marketers import petroleum products, and Brent crude is a major determining factor in the refining process. As prices rise, costs at depots follow suit.”

Bayo Adelaja, another industry figure, emphasized that:

“Consumers should expect further fluctuations in the coming weeks as the market responds to crude price volatility and import costs.”

What to Expect

  • Immediate Impact: Increased pump prices nationwide.
  • Medium-Term Trends: Continued volatility depending on crude oil prices and market conditions.
  • Long-Term Implications: Potential shifts in government policies regarding fuel subsidies and domestic refining capacity.

The rising costs highlight the importance of addressing Nigeria’s dependence on imported refined petroleum products and investing in domestic refining capacity to stabilize fuel prices and shield consumers from global market fluctuations.