The Nigerian National Petroleum Company Limited (NNPCL) has said that foreign exchange (forex) illiquidity is a significant factor influencing the fluctuation in prices of Premium Motor Spirit (PMS) occasioned by unrestricted free market forces.
According to the national oil company, this is provided for in the Petroleum Industry Act (PIA 2021).
The Executive Vice President, Downstream of the NNPCL, Adedapo Segun, in a statement, explained that the current fuel scarcity is expected to ease off in a few days as more stations will begin selling the product.
Mr Segun stated that Section 205 of the PIA, which established NNPCL, stipulated that petroleum prices would be determined by unrestricted free market forces.
“The market has been deregulated, meaning that petrol prices are now determined by market forces rather than by the government or NNPC Ltd.
“Additionally, the exchange rate plays a significant role in influencing these prices,” Mr Segun said
On the commencement of lifting PMS from the Dangote Refinery, Mr Segun noted that NNPCL was awaiting the September 15, 2024, timeline provided by the refinery.
Mr Segun said the NNPCL would supply a total of 17.6 million barrels of crude oil to Dangote Refinery between September and October 2024 as part of the Federal Government’s push to drive local production of petroleum products.
“We have supplied about 30 million barrels of crude oil to Dangote Refinery so far, and this month alone, we will be providing 6.3 million barrels of crude oil to the refinery in seven cargoes.
“In October, we will be providing another 11.3 million barrels of crude oil to Dangote refinery in 13 cargoes. We are doing everything possible to ensure this situation normalises,” he said.
He said that NNPCL has about 1,000 fuel stations nationwide and was collaborating with marketers to ensure that stations opened early and close late to maintain adequate fuel supply to meet the needs of Nigerians.
“We are also engaging relevant authorities to ensure product diversions are prevented and timely deliveries to all stations are ensured.
“The scarcity should ease in the next few days as more stations recalibrate and begin operations,” he added.
