Oil marketers said on Sunday that the price of Premium Motor Spirit, also known as petrol, would rise to between N680 and N720 per liter in the coming weeks if the dollar continues to trade between N910 and N950 on the parallel market.
The Punch reported that they also made hints that importers of PMS were having to postpone their plans due to a lack of available foreign currency.
The naira was trading at over 945 to the dollar on Friday on the parallel market, less than a week after the local currency broke over the N900/dollar ceiling.
The Federal Government must step in to handle the situation, according to the leaders of the Major Oil Marketers Association of Nigeria, Independent Petroleum Marketers Association of Nigeria, and Petroleum Products Retail Outlets Owners Association of Nigeria.
The National Public Relations Officer for the Independent Petroleum Marketers Association of Nigeria, Chief Chinedu Ukadike, noted that because currency swings now determine the price of petrol, Nigerians should prepare for a rise in price shortly.
In response to a question on whether oil marketers were considering raising the price of petrol, he said, “Once there is a gap in the naira against the dollar, there is going to be an effect. A major factor is the availability and demand for foreign exchange. In addition, we must realize that it’s not only petroleum products that use forex.”
He added that other manufacturers who import other goods are also looking for money. Consequently, the demand for dollars has grown.
“Since the dollar is currently trading between N910 and N940 and is getting close to N1,000, you can anticipate paying N750 per liter for PMS,” he said.
Ukadike claimed that oil marketers were still obtaining money from the black market since the CBN’s official Importers and Exporters window lacked liquidity.
“The pricing regime for Nigerians should be between N680 and N720 if the currency rate maintains between N910 and N950/$, but once the dollar goes to N1,000, the price would reach N750.
“This is due to the fact that almost all importers in Nigeria, including marketers, continue to obtain money via the black market. You should anticipate the price to change in line with the dollar because petroleum goods are no longer subject to subsidies,” he said.
The Executive Secretary of the Major Oil Marketers Association of Nigeria, Clement Isong, made reference to the fact that the dealers were not importing fuel despite the government having just granted permits to roughly six marketers to import goods.
Isong responded, “The I&E window is illiquid, there is no money there” when asked about the import of PMS by other marketers and whether they were sourcing FX via the I&E window or the parallel market.
“You must spend $25 million to $30 million to purchase goods. It is not visible in the I&E window. As a result, people are not importing because it doesn’t work.
“We can’t locate Dollar again, and you can’t locate it at this time. Nigeria must address the security concerns in the the Niger Delta so that we can increase our daily crude oil output. If we increase it to 1.8 or two million barrels per day, then there’ll be dollar in the market. So we need to stop oil theft.”
The president of PETROAN, Billy Gillis-Harry, had previously stated in a speech on the subject that “the price of petrol in our retail stores will keep rising so long as the naira is losing versus the dollar.”
He urged Tinubu to ensure that Nigeria’s refineries were once again put to work in order to address this.
According to Gillis-Harry, “That is the only sure way to go in order to be able to predict the price of petroleum products because for the time being, every PMS you buy in any retail outlet is dollarized.”