The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has accused petroleum marketers of exploiting Nigerians through inflated fuel prices, insisting that Premium Motor Spirit (PMS) should currently be selling for between N700 and N750 per litre.
Speaking at a press conference in Abuja today, PENGASSAN President, Comrade Festus Osifo, lamented that despite a significant drop in the price of crude oil, from around $80 per barrel to about $60, the pump price of petrol has not seen a corresponding reduction, remaining around N900 per litre, reports The Nation.
Osifo attributed the unjustifiable pricing to the failure of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to carry out its oversight duties effectively.
He said, “NMDPRA should not watch the suppliers of products exploit the citizenry on the pretence of deregulation.
“Also, comrades, we want to quickly talk about issues that are bothering the downstream. In the downstream today, in the Nigerian oil and gas industry, we have seen a trend. And the trend, if you could recall, at a time when the price per litre of petrol was sold around 900 Naira per litre, you realise that the international crude price was somewhere around $80 per barrel.
“So we have been monitoring the trend. When the crude price reduced to around $60 per barrel, we did not see a commensurate reduction in the pump price. Because naturally, two things contribute principally to the price of PMS, for example, or the price of petroleum products.
“One is the crude price, and the second is the exchange rate. So these are the two highest contributory factors. In fact, they contribute up to 80% of what the final price of PMS would be.
“So what that means is that when the crude price reduces, the PMS price also reduces, most especially when the exchange rate has been relatively constant. So if crude price was somewhere around $80 per barrel, and we were having pump price at about 900 Naira per litre or thereabout, today, at a time, crude price hovers around $62 to $65 per barrel. But we only saw a marginal reduction in the pump price.
“And if you do the calculation, you will realise that it is, I mean, Nigerians were exploited within that period. Because there is what we call PLAT. If you go online, you are going to see the PLAT cost per cubic metre of PMS.
“And when you convert that to litres, and you bring it down to our Naira, you are going to see that at a time when crude price was around $60 per barrel, we should be buying our PMS somewhere around “$700 to $750 per litre. That is how it should be when you do the calculation properly. Yes, we understand that people have invested in their business, and they want to make a profit.
“It is the responsibility of businessmen to maximise profit. We don’t begrudge any business organisation that wants to maximise profit. That is why we have the regulators.”
He stressed that at the current international crude price levels, PMS should be retailing between N700 and N750, citing pricing models like the PLATTS index used globally to benchmark refined product costs.
PENGASSAN urged NMDPRA to regularly publish pricing templates to ensure transparency and prevent exploitation under the guise of deregulation.
“We don’t begrudge businesses for making profits. But it is the regulator’s responsibility to protect the people. If this exploitation continues, Nigerians will never benefit from global oil price drops—only bear the burden when prices rise,” Osifo added.
He concluded with a rallying call for action and also expressed concern over the continued shutdown of the Port Harcourt Refinery, questioning the pace of the government’s refinery rehabilitation efforts.
