The Vice President of Downstream at the Nigerian National Petroleum Company, Adedapo Segun has asserted that the current pump price of petrol does not accurately reflect market conditions and could be higher.
In an interview on Arise TV’s morning show, Segun detailed the challenges faced by the company concerning petrol supply.
He pointed out that despite the recent rise in petrol prices from N617 per litre to N897, the pricing still fails to align with free market principles.
“You’ll recall that I said earlier that in the summer months prices are high and as we move towards the winter months, prices drop. So you expect to see prices drop in those climes where petrol prices are market based but the opposite is our situation.
“We are not at our full market pricing of PMS yet and that is why the behaviour of PMS prices in Nigeria cannot be compared to those markets where the prices are fully market based. And if you are going to do a comparison, you’ll check out the equivalent of those prices you see in those climes and compare them to the prices here and you’ll see they are way higher than the prices we are offering when you bring them to a common currency,” he said.
He further discussed the Petroleum Industry Act which mandates a free-market pricing system designed to foster competition and improve service quality in the industry.
Segun also pointed out that exchange rate issues are currently affecting NNPC’s operations, but he expects the ongoing petrol scarcity to resolve in the coming days.
Regarding the company’s financial obligations, Segun assured that NNPC has never defaulted on its debts and retains the trust of industry marketers.
On Tuesday, the NNPC raised the pump price of petrol from N617 per litre to N897, sparking frustration among Nigerians enduring a month-long scarcity of the product.
Industry experts argue that despite this increase, the price does not accurately reflect market conditions.
The projected landing cost of petrol stands at N1,200 per litre, which suggests that the current pricing still falls short of covering actual costs. This disparity highlights a lingering issue since the removal of the subsidy in June last year
