The Nigerian National Petroleum Company Limited (NNPCL) announced that Premium Motor Spirit (PMS), commonly known as petrol, from the Dangote Refinery will hit the market starting September 15, 2024. This statement was made in Abuja by NNPCL's Chief Corporate Communications Officer, Olufemi Soneye, following the refinery's commencement of petrol refining earlier this week.
According to NNPCL’s Executive Vice President of Downstream, Adedapo Segun, petrol prices will now be determined by market forces due to the complete deregulation of the downstream sector. This announcement has dispelled ongoing speculation that the company would continue to set prices for petrol, despite claims of market deregulation.
“The current fuel scarcity is expected to ease in the coming days as more filling stations recalibrate and resume selling PMS,” Segun stated, emphasizing that the fluctuation in petrol prices has been substantially affected by foreign exchange (forex) illiquidity.
Segun reiterated that Section 205 of the Petroleum Industry Act (PIA) mandates that petroleum prices be dictated by free market conditions. “The market has been deregulated, meaning petrol prices will be determined by market dynamics rather than government or NNPCL interventions,” he explained.
NNPCL highlighted that it has already supplied 30 million barrels of crude oil to the Dangote Refinery, with plans for an additional 17 million barrels soon, including 6.3 million barrels in September and 11.3 million barrels in October.
The company also noted concern that current pump prices for petrol do not align with market realities. Segun commented, “NNPCL is the sole importer of PMS, which is not ideal. We should aim for a situation where free market forces drive prices.”
He clarified that NNPCL's role as the primary importer is not a strategic choice but rather a reaction to declining participation from other market players. “NNPC is not in a monopolist role by design; we entered the market when others stepped back,” he stated.
Segun highlighted that achieving stable fuel prices requires optimal market conditions, including improved forex liquidity.
“We will provide further updates once the Dangote Refinery begins the rollout and NNPCL commences lifting operations,” he concluded, assuring the public of efforts underway to prevent product diversions and ensure adequate fuel supply across the country.