The Nigeria Labour Congress (NLC) has frowned on the recent hike in the pump prices of Premium Motor Spirit (PMS), popularly called petrol, describing it as the height of insensitivity against the masses.
Senior NLC officials disclosed this in separate interviews with our correspondents on Sunday, as oil marketers refuted being blamed for the recent hike in PMS prices nationwide.
Similarly, the Dangote Petroleum Refinery also said the rise in petrol price was not from the $20bn Lekki-based plant but due to an increase in the cost of crude oil, the major component for refined petroleum products.
On Friday, the pump prices of petrol rose to between N1,050 and N1,150 per litre following the hike in the cost of the commodity by the Dangote Petroleum Refinery and various depot owners.
Dealers confirmed that PMS prices would continue to rise since the major component in fuel production, crude oil, has been on the upward swing lately.
Reacting to this, the Deputy President of Nigeria Labour Congress Political Commission, Prof Theophilus Ndubuaku argued that in a saner clime, representatives of workers, the organised private sector and students would have been called to a roundtable to deliberate on the course of action and analysis of the consequences before the decision would be taken.
He said, “This pump price hike will not only affect foodstuff and fare. There is the problem of inflation and the value of naira to contend with. Instead, what we are seeing is a situation we call Tinubunomics. It is something that has not been tested.
“When you talk about subsidies, is there a country that doesn’t have it? It’s all over the world. Even most of the goods you see in this country from China are subsidised. You are refusing to subsidise fuel and also refusing to even facilitate the so-called CNG buses. How many years does it take to do something like this?
“If you know the kind of game we (the NLC) and them are playing on this CNG thing. Now, they are not even involving the people in the so-called CNG conversion. If you promise to run an inclusive government, It’s not just you that should be doing the talking. Yet, when somebody talks, they send attack dogs to attack and label him a member of the Obidient movement.”
Continuing, Ndubuaku emphasised that President Bola Tinubu will do well to borrow the template of former leaders like Olusegun Obasanjo, who he claimed held a monthly roundtable with stakeholders whenever sensitive issues that have a lot to do with workers’ welfare were being discussed.
“Such discussions were held in the Villa. Every month people would be invited and issues would be discussed. We’re not saying you shouldn’t do it. But please, carry people along. Let us know why you want to do these things so people will be prepared.
“But you can’t just keep changing the prices without any regard for us? This is what is causing all this frustration. They are not carrying the masses along. They have virtually made it difficult for the NLC to be involved in anything they are doing. Nigeria is not the personal property of anybody.
“If you are going to do anything that will involve the masses, you should call the people who represent the workers at least. You have certain blocks and groups of people in this country that have representatives, even in the so-called business sector that you can talk to,” he explained.
Also speaking on the hike in petrol price, the Chairperson of the Nigeria Labour Congress in Lagos State, Sessi Funmi, accused oil marketers of being major contributors to Nigeria’s economic challenges, describing them as “enemies of the masses.”
Speaking on Sunday, Sessi criticised oil marketers for manipulating petroleum pricing to exploit Nigerians, alleging that they were undermining the government’s efforts to stabilise the downstream oil sector.
She asserted that the recent reduction in the pump price of petrol did not sit well with marketers because it disrupted their exploitative practices.
“How can marketers be telling us that an increase in crude oil prices automatically translates to higher prices for the finished product? Are they buying crude oil? No! They buy the finished product,” Sessi said.
She applauded Tinubu’s administration for reviving two of Nigeria’s refineries in Port Harcourt and Warri, emphasising that these developments should lead to a further reduction in PMS prices.
She argued that oil marketers are attempting to frustrate these efforts to maintain their monopolistic control.
“The Tinubu administration has done what successive governments failed to do by putting our refineries to work. Marketers should stop frustrating these efforts.
“The government must deal directly with suppliers and eliminate middlemen who corruptly enrich themselves,” Sessi added.
She urged the government to emulate Dangote refinery’s direct supply model and establish agreements with oil companies and petrol stations to ensure fair pricing.
“Marketers are the problem. They’ve been receiving subsidies without supplying products and now want to determine prices when they don’t even own refineries.
‘We reject this. Nigerians cannot continue to suffer due to their greed,” Sessi concluded.
The NLC chair called for transparency and accountability in the petroleum sector, warning that Nigerians will no longer tolerate exploitative practices.
The Dangote refinery said it has agreed with its partners – MRS, Ardova and Heyden – to sell its PMS at the rate of N970 per litre across the country.
The company said it absorbed the increased logistics costs to guarantee uniform pricing across the 36 states of the federation and the Federal Capital Territory (FCT).
In a statement by the Dangote Group spokesman, Anthony Chiejina, the company clarified that the recent adjustment in its ex-depot price of petrol was directly related to the significant increase in global crude oil prices.
“At Dangote Petroleum Refinery, we recognise the critical importance of affordable fuel for all Nigerians, and we remain committed to offering the best value with guaranteed quality to our customers. While we have made a five per cent adjustment to our ex-depot price from N899.50 to N950 per litre, it is important to note that this increase is considerably lower than the 15 per cent rise in global crude oil prices. Furthermore, Dangote refinery has maintained the Single-Point Mooring ex-vessel price at N895 per litre.
“All our partners, including Ardova, Heyden, and MRS Holdings, will offer petrol to Nigerians at a retail price of N970 per litre nationwide. We have absorbed the increased logistics costs to guarantee uniform pricing across the 36 states of the federation and the Federal Capital Territory,” Chiejina said.
Speaking further, he said the Dangote refinery absorbed approximately 50 per cent of the cost increases in the international oil market due to its unwavering commitment to quality and affordability, as well as the ownership of the refinery by Nigerians.
“If Dangote refinery were to pass on the entire increase in the price of crude oil to the market, the retail price of PMS would be approximately N1,150 to N1,200 per litre in some locations, compared to the current price of N970 per litre.
“We are committed to providing reliable, top-quality petrol to the Nigerian people at competitive prices. In these challenging times, we continue to prioritise the best interests of Nigerians, striving to shield consumers from the full impact of global price volatility while adapting to evolving market conditions.
“We sincerely appreciate the continued trust and support of Nigerians as we strive to deliver the best value for their money and contribute to the development of a self-sufficient economy that is resilient to international price fluctuations,” he stated.
In the interest of transparency and good governance, Chiejina said the Dangote refinery will now commence publishing its ex-depot price, ex-vessel price, and pump price every week so that consumers are not exploited.
He concluded, “We would like to express our gratitude to President Bola Tinubu for the introduction of the visionary Naira-for-Crude Initiative. This groundbreaking initiative has enabled consistent access to high-quality PMS for all Nigerians, while also insulating the Nigerian consumers from the volatility of the global oil market.”
Meanwhile, marketers of petroleum products said they should not be blamed for the instability in the prices of petrol in recent times.
This is as stakeholders warned that the price of petrol will no longer be stable following the full deregulation of the market.
According to them, the major factors determining the price are the international crude oil price and the exchange rate. It was argued that the instability of the two factors means that the price of PMS will continue to rise and fall at intervals.
As of Sunday, the Benchmark Brent crude price was $80.78; the WTI was $77.88 while the Morban crude was $83.65, according to oilprice.com. Nigeria’s Brass River crude was $83.69 and the Qua Iboe was $83.59.
Retailers under the aegis of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) urged Nigerians, especially the labour unions, not to believe that filling stations are to blame for the changes in the prices of PMS.
PETROAN affirmed that the increase in PMS prices was a result of the rise in the cost of crude oil in the international market.
Prices were said to have risen to a four-month high following the introduction of new United States sanctions against Russian oil.
The sanctions imposed on January 10 caused a spike in the price of oil and a surge in the cost of tanker shipping, as the outgoing President Joe Biden’s administration took steps to damage Russia’s oil exports and hinder attempts by Moscow to build its fleet.
The Biden administration had issued sweeping sanctions targeting the Russian energy sector, aiming for Moscow’s oil revenues just days before Donald Trump would assume office.
The measures include sanctions on Russian oil producers, Gazprom Neft and Surgutneftegas, and the blacklisting of 183 vessels involved in Russian energy exports. Dozens of traders, Russia-based oilfield service providers, and energy officials were also targeted.
The National President of PETROAN, Dr Billy Gillis-Harry, quoting Section 205 of the Petroleum Industry Act, stated that petrol prices are determined by market forces, indicating that the government and the Nigerian National Petroleum Company Limited no longer set petrol prices nor do marketers arbitrarily inflate prices.
As a result, he noted that refinery operators in Nigeria will respond accordingly to changes in crude oil prices while the effect would be felt by dealers, retailers, and end consumers.
Gillis-Harry noted that increasing crude oil prices would inevitably affect domestic costs.
“Retailers should not be blamed for the price increase. It’s no longer funny; even we, retail outlet owners, are affected by this up-and-down movement of prices. It affects our business,” he noted.
Gillis-Harry emphasised that PETROAN members cannot buy petrol at a higher price and sell it at a lower rate.
“Our selling rate always reflects our buying rate. Our members shouldn’t be blamed for the current increase; it’s an external factor. We cannot buy petrol at a higher price and sell below that cost. We cannot buy at N955 and sell at N1,000 per litre. We need to look at logistics and add a humane margin,” he added.
The National Vice Chairman of the Independent Petroleum Marketers Association of Nigeria, Hammed Fashola, said marketers are aware of the competition in the market and no one wants to be left behind by selling at higher rates.
“You cannot deceive yourself. There is competition out there. So, if you like, put your fuel at N1,500 per litre, nobody will buy it. So, the price change is not deliberately done by marketers,” Fashola said.
He noted that marketers are now wary of the volatility of the downstream sector, saying they have to go with information before making purchases or before making imports as many of them made losses in December when the price was suddenly reduced by the Dangote refinery and the NNPC.
“And there are some factors you have to consider. That is the exchange rate and the crude oil price. Those are the major factors that determine the price of petroleum products,” he added.
To avoid running into financial losses, he advised that owners of filling stations must be futuristic and do their projections well. – Punch.
