The Federal Government, weekend, said it would undertake a review of the pricing template for Premium Motor Spirit, PMS, also known as petrol, to forestall a further increase in the price of the commodity.
Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, stated this during a grand award ceremony organised by the Petroleum Products Pricing Regulatory Agency, PPPRA, Branch of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, in Abuja.
Kachikwu disclosed that the review of the template, which would be done with oil marketers and other stakeholders, would help cushion the effect of rising foreign exchange rates and the dwindling value of the naira against major international currencies on the price of petrol.
He also stated that he is not aware of the fact that the retail arm of Nigerian National Petroleum Corporation, NNPC, has increased the price of petrol from N141 per litre to N145 per litre, the maximum price allowed by government under the price modulation mechanism,.
He said that he would consult with the NNPC management to understand the reason for the increase.
“I am not aware that the NNPC has increased price. I need to look into that, it is a bit of surprise for me, because they are processes in doing this, if they have done that, it means they are doing it wrongly.
“ Let me find out what the facts are,” he noted.
Commenting on the petrol price template, Kachikwu explained that the review would eliminate certain charges that are attributable to the Federal Government and some of its agencies, so that the price can be retained where it is at the moment.
He said, “One of the things I think we had hoped to do, which we would still do, before we embark on any price increase is to work on those templates.
There are still areas that are within the government controlled aspects; payments to the Ministry of Transport and the rest; payments to the Nigerian Ports Authority, NPA.
“We are working on the possibility of being able to shift that out so that we can still modulate the prices within where it is right now. But I would hold a conversation with the industry and see how it is going.
“At the end of the day, I think PPPRA is the one that has the authority to say it is time the templates does justify some level of movement, otherwise you have a crisis of individual decisions on pricing,” he said
Furthermore, Kachikwu explained that the meeting brokered between President Muhammadu Buhari and leaders of the Niger Delta was part of a series of actions to bring lasting peace to the Niger Delta region.
He lamented that the crisis recorded in the region over the last one year had taken its toll on the country, its resources and even the sustenance of the oil industry.
He said, “The President is committed to finding solutions to these problems; but he is committed to finding lasting solutions, not one-offs that would come to haunt us again afterwards.
That is why he is taking his time to understand how these people operate.”
Meanwhile, the Nigeria Labour Congress (NLC) has warned the Federal Government against any further increase in the pump price of petroleum products, especially Premium Motor Spirit, otherwise called petrol.
The warning is coming as the retail stations of the Nigerian Petroleum Corporations in the Federal Capital Territory and its environs have increased the pump price of the PMS to N145 from the initial N141.
Similarly, some private marketers of petroleum products are now selling petrol in their outlets at N150 per litre.
One of our correspondents reported that some filling stations in Lagos and Ogun states had refrained from selling the product.
For instance, the Oando filling stations at Alapere and Berger as well as the Mobil filling station opposite the Magodo Estate gate did not dispense the product to members of the public since Friday.
Similarly, the Ascon and NNPC stations between Arepo and Magboro, off the Lagos-Ibadan Expressway, Ogun State, did not sell the product on Sunday, raising fears of another round of fuel scarcity.
The General Secretary, NLC, Dr. Peter Ozo-Eson, told one of our correspondents on the telephone on Sunday that it would be insensitive on the part of the government to increase fuel price in view of the current hardship in the land.
Ozo-Eson added, “Well, we have been clear on this matter from the beginning that once you submit the determination of the prices of the products to the market, the way they are doing it in an import regime, that will devalue the naira. Therefore, they will come back and tell you the prices are not realistic. We knew that from the beginning and we said so.
“The fact of the matter is that any attempt to increase the price of fuel now, given the level of hardship and the level of suffering Nigerians are going through, will be regarded as extremely insensitive.”
The NLC secretary pointed out that while the NLC was opposed to any further adjustment in the price of fuel, it was up to Nigerians to also decide how to live with such an adjustment.
He stated, “We do hope that Nigerians will realise that this has no end, and what the government is doing will continue to impose extreme hardship on them, and they need to tell the government that enough is enough.
“Other than that, we oppose any adjustment in the pump price. If the government goes ahead to do it, it will indicate what we hinted right from the beginning that the policy adopted was wrong, and it remains wrong.
“It is up to Nigerians to oppose it. We provided the necessary leadership based on our understanding of the issues and the reality is coming home to roost and it is never too late. Nigerians will have to take the decision as to how they have to live with it.”
While the Petroleum Products Pricing Regulatory Agency refused to confirm or deny any plan to adjust the price of petrol, one of our correspondents quoted officials of marketing firms as blaming the increase in the pump price on the high cost of the commodity at depots.
The pricing template of the PPPRA for PMS was last updated on May 24, 2016 and it had the pump price at a band of N135 to N145 per litre.
When asked to comment on whether the PPPRA was on the verge of hiking petrol price, the agency’s Acting Executive Secretary, Mrs. Sotonye Iyoyo, stated that forex had remained a challenge and noted that the agency works with the prevalent market fundamentals when determining or fixing petrol price.
Iyoyo said “Today as we know there is scarcity of foreign exchange and when we want to fix prices we look at the market fundamentals. We don’t just fix prices without looking critically at the fundamentals of the market.
“There is a price band that is between N135 and N145. The maximum is N145, and so anyone selling at that price is still within the price band.”
