Revealed: Marketers disclose why petrol prices may crash

• Petrol marketers have reported a further drop in the landing cost of the product
• Data from the Major Energy Marketers Association of Nigeria (MEMAN) revealed that it dropped from N981 to N945.63 per litre
• The decrease represents a significant decline in the commodity’s price from the one recorded in July at N1,130 per litre in July this year

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

The landing cost of petrol has dropped further from the N981 per litre recorded on September 25, 2024, to N945.63 per litre, beginning from September 27, 2024.

Major Energy Marketers Association of Nigeria (MEMAN) revealed this in its Competency Centre Energy Bulletin Data shows.

Oil marketers report a drop in the landing cost of petrol Credit: Bloomberg/Contributor
Source: Getty Images

Petrol landing costs crash by N200 per litre

The decrease represents a significant decline in the commodity’s price from the one recorded in July when it was N1,130 per litre.

A previous report by Legit.ng shows that the landing cost of petrol dipped to N981 per litre from N1,130 recorded in July.

However, the marketers attributed the decline to the naira's rise against the dollar in the FX market.

According to the MEMAN data, a dollar exchange for N1,586 on September 27, 2024, from N1,667.22 as of September 25, 2024.

The naira’s rise affects landing costs

Data from the FMDQ Exchanges shows that as of September 30, 2024, the naira stood at N1,541 per dollar.

Additionally, the MEMAN data showed that the global benchmark for Brent crude dipped from $73.67 per barrel to $72.45 as of September 30, 2024.

The drop is also attributed to the reduction in the landing cost of imported petrol.

Marketers quoted the ex-depot prices at a reduced rate in Lagos, Calabar and Port Harcourt.

FG begins sales of petrol in naira to refineries

The development comes as the Nigerian National Petroleum Company Limited (NNPC) announced a fresh hike in petrol prices to N950 and N1,100 per litre after lifting petrol from the Dangote Refinery/

The state oil company disclosed that it purchased the product from the Refinery at N898 per litre, a claim the Dangote Group refuted, calling NNPC’s statement misleading and mischievous.

Meanwhile, the Nigerian government has announced that the crude oil sales in naira to local refineries have commenced.

The Minister of Finance, Wale Edun, disclosed the development on Saturday, October 5, 2024.

President Bola Tinubu had asked the NNPC to begin selling crude oil to domestic refineries in the local currency to ease the pressure on the FX market.

According to reports, the government promised to sell crude oil to naira refineries from October 1, 2024, to relieve Nigerians.

Edun said:

“Following a meeting of the Implementation Committee, Chaired by the Honourable Minister of Finance and Coordinating Minister of the Economy to conduct a post-commencement review of the Crude Oil and Refined Products Sales in Naira initiative, the commencement of this strategic initiative was affirmed by key stakeholders.”

Marketers weigh Dangote petrol price with imported fuel

Legit.ng earlier reported that oil marketers in Nigeria would buy petrol directly from Dangote Refinery. However, they will face price challenges.

The reason is a price difference between Dangote petrol price and imported PMS.

While the Dangote Refinery can supply much of Nigeria’s domestic petrol needs, the government strictly controls pricing via the Nigerian National Petroleum Company Limited (NNPC), creating a significant hurdle for marketers.

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Source: Legit.ng