On Tuesday morning, the federal government-owned NNPC Limited abruptly increased the price of gasoline at the pump in Abuja from N537 to N617 per litre.
Following the deregulation of the downstream sector of the Nigerian oil and gas industry, the national oil corporation has not provided any explanation for the most recent price hike.
However, The Spectator’s investigations revealed that under the current deregulation, each operator is free to alter prices in accordance with its cost components.
It also demonstrated how pressure from the depreciating value of the Naira has been placed on large and independent traders as well as gasoline importers like NNPC Limited.
As the price increase spreads to other cities, including Lagos and its surrounds, where some gas stations have modified their pumps to above N600 per litre, Vanguard’s checks revealed that many drivers and others have hurried to buy gasoline.
Commenting on the development, the national operations controller, of the Independent Marketers Association of Nigeria, IPMAN, Mike Osatuyi, said: “It is not about the NNPC Limited. It is about the market fundamentals. Every marketer stands alone with its different cost elements. The low value of the Naira is currently impacting the market. It is now more than N800 to a dollar.
“This is why the market is responding this way. It has to spread because as operators, our price depends on our cost.
“Even though some importers have been able to import the product, it cannot be cheap because it is based on the current market fundamentals, especially foreign exchange.
The public should also know that importers source their foreign exchange from the banks at the current rate. “
