Nigeria Govt Finally Speaks On Increase In Price Of Petrol

The Federal Government has said it will not intervene to regulate petrol prices despite the volatility in global oil markets caused by escalating geopolitical tensions in the Middle East.

The Minister of Finance, Wale Edun, disclosed this in an interview on Channels Television on Wednesday, stating that the government would instead introduce measures to cushion the impact of rising energy costs on Nigerians.

Edun said the government would pursue initiatives such as expanding the use of compressed natural gas for vehicles rather than interfering in market-driven pricing of petroleum products.

According to him, President Bola Tinubu has already approved the provision of 100,000 additional compressed natural gas conversion kits to help motorists switch from petrol to CNG.

He explained that CNG costs about 25 to 30 per cent of the price of petrol, making it a more affordable alternative.

Edun said, “When there is market failure is where the regulator steps in. But in terms of balancing pricing, what we are looking to do is to manage the disruption and we don’t know how permanent or temporary it could be.

“But in the meantime, rather than reverting back and taking backward steps, we’ll look at every other measure that we have that can help the cost of living of Nigerians.”

The Middle East crisis has triggered significant instability in global oil markets.

Crude oil prices surged above $100 per barrel on March 9, the highest level since July 2022, before dropping to $87 the following day.

The Ministry of Finance had earlier warned that the conflict could affect Nigeria’s crude oil and gas prices, capital flows, financial markets, and global logistics and supply costs.

The spike in crude oil prices and rising ex-gantry petrol prices have led to increases in pump prices across the country.

This has pushed up transportation costs, with fares reportedly doubling on some major routes.

Edun noted that the price adjustments by private sector operators, including the Dangote refinery, reflect prevailing market realities.

On Tuesday, the Dangote refinery reduced its ex-gantry petrol price to N1,075 per litre after implementing three earlier increases.

Despite the reduction, pump prices at filling stations remain high.

Commenting on the development, Edun said the fluctuations were part of normal market dynamics under the government’s market-based pricing policy.

He said, “Dangote reduced their price from, I think, around N1,200 to now just over N1,000 to N1,050, and that’s the dynamics of the market.

“But I think we should be thankful at this time for the capacity we have in Nigeria to refine crude into petrochemicals and petroleum products.”

The minister said Nigeria’s current resilience in the energy sector is largely due to increased local refining capacity, particularly through investments by the private sector.

He specifically acknowledged the role of Aliko Dangote, President of the Dangote Group, whose refinery has begun supplying petroleum products locally.

Edun added that Nigeria must support its domestic refiners to ensure a steady supply of petroleum products.

“America is just now rushing to open another refinery. Pakistan, Thailand, in the absence of that capacity, they’re almost closing down their economies and societies, schools, and sending people home,” he said.

Meanwhile, the African Democratic Congress has urged the Federal Government to introduce a temporary cap on petrol prices to prevent further increases that could worsen the cost of living for Nigerians.

The party suggested that the cap should be time-bound and designed to protect consumers during the current global energy uncertainty.For more, Read Full; Original.