FEDERAL GOVT INTRODUCES NEW PUMP PRICE FOR PETROL

Minister of State Petroleum Ibe Kachikwu

                        

Federal Government has deregulated the downstream sector of the oil industry in a bid to halt the perennial fuel scarcity that has been rocking the country in the last few months.

The meeting which had various stakeholders presided over by His Excellency, the Vice President of the Federal Republic of Nigeria, took place at the state house Abuja.

The meeting had in attendance the Leadership of the Senate, House of Representatives, Governors Forum, and Labour Unions (NLC, TUC, NUPENG, and PENGASSAN).

The meeting reviewed the current fuel scarcity and supply difficulties in the country. It also looked at the exorbitant prices being paid by Nigerians for the product. These prices range on the average from N150 to N250 per litre currently.

Ibe Kachikwu said the meeting also noted that the main reason for the current problem is the inability of importers of petroleum products to source foreign exchange at the official rate due to the massive decline of foreign exchange earnings of the federal government. As a result, private marketers have been unable to meet their approximate 50% portion of total national supply of PMS.

He said in a bid to increase and stabilize the supply of the product, any Nigerian entity is now free to import the product, subject to existing quality specifications and other guidelines issued by Regulatory Agencies.

All Oil Marketers will be allowed to import PMS on the basis of FOREX procured from secondary sources and accordingly PPPRA template will reflect this in the pricing of the product.

Pursuant to this, PPPRA has informed me that it will be announcing a new price band effective today, 11^th May, 2016 and that the new price for PMS will not be above N145 per litre.

With this new regulation it is expected that this new policy will lead to improved supply and competition and eventually drive down pump prices, as we have experienced with diesel.