The Nigerian National Petroleum Company Limited, NNPCL, has increased the pump price of Premium Motor Spirit, PMS, popularly known as petrol.
Metrobusinessnews.com (MBN) survey on Tuesday showed that the majority of NNPCL retail outlets in Abuja and Lagos had increased their petrol pump price to between N1,395 and N1,430 per litre.
This means that the state-owned oil firm adjusted its petrol price upward by between N50 and N80 per litre.
This is even as Africa’s wealthiest industrialist, Aliko Dangoto explained why petrol remains expensive in Nigeria despite the country’s large-scale refining capacity and its status as a major crude oil producer.
Dangote, at the Arise Television’s programme, The Morning Show, on Tuesday, attributed the high price of petrol in Nigeria mostly to the continuous smuggling of the commodity to neighbouring countries where it sells for much more despite the surge in prices in Nigeria.
The industrialist, whise refinery recently increased the gantry price of petrol from ₦1,265 to ₦1,350 per litre, effective September 12, argued that the question of the high price of petrol in Nigeria is relative when compared to the price of the commodity in neighbouring countries.
He said that despite petrol being expensive in Nigeria, it still costs 30% to 50% more in these neighbouring countries, thereby encouraging smuggling from those traders for instant return.
When asked why petrol is still expensive in Nigeria, Dangote said, ‘’The expensive is relative in the sense that today, there is ignorance too, what they need to do is to ask what is the neighbour’s price. I don’t know whether you know there is still a lot of smuggling of the same petrol we are producing to our neighbouring countries.
‘’Those neighbouring countries are about 30% to 50% more expensive than in Nigeria. So it’s not actually like-for-like. People can now go and ask, what is the price, even now, at N1,350, the price in Niger is 20%, 25% more than in Nigeria.
So what business are you going to do that will make you have an instant 25% return? So it means that you will take the risk to go and take it across the border, you pretend that you are taking it to Sokoto, and you go and just take it to Ilela and you sell.’’
This means that the state-owned oil firm adjusted its petrol price upward by between N50 and N80 per litre.
However prices of crude fell on Wednesday after an unexpected build in U.S. crude inventories, while investors assessed supply risks after Saudi Arabia suspended oil loadings at its Yanbu port following an attack on its East-West pipeline to the Red Sea.
Brent crude futures fell 93 cents, or 0.86%, to $107.82 a barrel at 0028 GMT, while U.S. West Texas Intermediate futures were down 97 cents, or 0.92%, at $104.86 a barrel.
Both benchmarks settled more than $3 higher and at their highest levels since May 19 on Tuesday, as the Yanbu loading suspension stoked supply concerns and Saudi Arabia cut oil shipments to Europe
U.S. crude oil, gasoline and distillate inventories all rose last week, market sources said on Tuesday, citing data from the American Petroleum Institute.
