Experts predict fuel to sell for N1k per litre by December as FG says 56 firms now have import license

According to energy policy analysts, the combination of high Forex and lack of funds might drive the price of petrol to N1,000 per litre on or before December 2023.

They reveal that the twin problem of lack of access to funds and volatile Forex will drive the cost of the commodity through the roof in the coming months.

NNPCL currently dispensing old stock

As it stands, only a few marketers are importing the product into Nigeria.

The Nigeria National Petroleum Corporation Limited (NPPC), which solely imported the product, is now a publicly owned entity and would sell the commodity commercially to marketers.

Currently, the NNPC sells the product above N500 per litre, from the N488 it sold when President Bola Tinubu announced the removal of the petrol subsidy on May 29, 2023, during his inauguration speech.

Despite NNPC claiming that the current hike in petrol prices is due to market forces, analysts believe it's more of a product scarcity than market forces.

"Currently, we do not have any records that NNPC brought in any new products since May when the announcement to remove subsidy was made by President Tinubu," Michael Uwakwe, energy policy analyst, told Legit.ng.

"We never read anywhere that NNPC brought in new supplies since May this year.

"The company has been running and selling to marketers the old products it had in stock before the subsidy was removed.

"This is an insult to Nigerians because NNPC presumably bought the product with money budgeted for subsidy by the previous administration. When the new government announced the end to subsidy, it began to sell the same product at an exorbitant cost."

Another energy policy analyst and Team Lead, Platforms Africa, Adeola Yusuf, said petrol prices may moderate as new marketers enter the market.

He said some forces determine the product's price, stating that it could swing either way as it is a deregulated market.

According to the Platforms Africa boss, oil marketers wanted the naira to float so they could access Forex easily, so complaints of lack of access to Forex are invalid.

He advised President Tinubu to channel the proposed subsidy palliative to repairing the refineries as that would ease importation headaches for the country.

Yusuf said the current price increase is due to a hike in the price of crude oil in the international market.

FG licenses 56 petroleum marketers

A source at NNPCL told Legit.ng that the company is currently dispensing old products in its stock since May.

"The company's position on market forces is true, but that is not all there is. The company may not import the product at the same price it did in May due to high foreign exchange and increase in the price of crude."

"So, the need to hike prices is to recoup impending losses."

The development comes as the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDRA) said the demand for petrol fell by 35% since subsidy removal.

The agency's Chief Executive Officer, Farouk Ahmed, said the daily PMS truck had reduced immensely to about 47 million litres daily from 66 million litres in May.

The Guardian reports that Ahmed disclosed that the Authority has licensed about 56 oil marketing firms to import petroleum products, but only 10 have shown commitment.