Forex Crisis Main Reason For High Petrol Price – Operators

Crude oil refiners and Operators in Nigeria’s downstream sector have pointed to dollar-denominated charges on locally refined petrol as a major factor behind the higher cost of locally produced fuel compared to imported Premium Motor Spirit (PMS).

Data from the Major Energies Marketers Association of Nigeria (MOMAN) revealed that as of December 5, 2024, the cost of landing a litre of imported petrol into the country was N958.89, while petrol produced by the Dangote Petroleum Refinery was priced at N970 per litre.

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EKO HOT BLOG reports that the price of petrol refined at the Port Harcourt Refining Company stood at N1,030 per litre, indicating that locally refined petrol is significantly more expensive than imported alternatives.

Industry operators have blamed these high prices on the ongoing dollar charges applied to locally refined products. The Crude Oil Refinery Owners Association of Nigeria (CORAN) highlighted that several charges, including those for jetty services, remain in foreign currency, which in turn increases the cost of petrol. CORAN’s Publicity Secretary, Eche Idoko, lamented that the practice of charging in dollars continues to impact the downstream sector, adding that it poses a major challenge to business operations within the industry.

Marketers are calling for the Nigerian Maritime Administration and Safety Agency (NIMASA) and other relevant government agencies to switch to naira for their charges, which would help reduce the cost of locally refined fuel. The National Vice President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Hammed Fashola, expressed concerns that if these agencies continued to charge in dollars, fuel prices would remain high, regardless of the crude oil prices.

Fashola, along with other stakeholders, has urged the government to enforce the presidential directive that mandates crude oil and refined products to be sold in naira.

They emphasized that converting charges to local currency is critical for stabilizing fuel prices in the country.

High Petrol Price Operators

As Nigeria’s downstream sector continues to grapple with these challenges, stakeholders are hopeful that addressing the issue of dollarized charges will help alleviate the pressure on fuel prices and improve the affordability of petrol for consumers.

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