Independent oil marketers on Wednesday adjusted the pump price of petrol in the Federal Capital Territory to reflect the price at which they bought the product from Dangote Refinery and Petrochemical Company.
Checks by NewsNGR revealed that many filling stations have adjusted their pump price of petrol to an average of N1,200 per liter.
The adjustment followed the full deregulation of the downstream sector of the petroleum industry, which allowed the Nigerian National Petroleum Company Ltd to end its exclusive purchase agreement with Dangote Refinery.
This effectively opened up the market for other marketers to buy petrol directly from the refinery.
The implication of this is that the NNPC will no longer be the sole off-taker, and marketers can now negotiate prices directly with Dangote Refinery.
This development aligns with the current practices for fully deregulated products, where refineries can sell directly to marketers on a willing buyer, willing seller basis.
NewsNGR had reported in September that the prices of PMS supplied by Dangote range from N898 to N1,019 per litre based on the estimated pump prices.
As of last month when NNPC was the sole off-taker of the petrol from Dangote refinery, the National Oil Company sold the product to Nigerians at N897 per liter while other independent oil marketers sold the product at between N930 and N985 per liter.
However, checks at various petrol stations operated by independent oil marketers on Wednesday revealed that the pump price has been adjusted upward to about N1,200 per liter to reflect the price of petrol from Dangote Refinery
For example, at Eternal filling station in Area 8, the price of petrol is being sold for N1,200 per liter, while for Mobil filling station on airport road in Lugbe axis, it was sold for N1,025 per liter.
Similarly, Conoil in Central Area has increased the price of the product to N1,040 per liter while the price was the same at AA Rano at N1040 per liter.
Umaratu Nigeria Ltd in Gwarinpa sold the product for N1,200, Rainoil N1,120, and Total filling station in Garki sold for N1,080 per liter
NNPC’s withdrawal as the sole off-taker of Dangote petrol marks a significant shift towards complete liberalization of the market, allowing marketers to source products directly from Dangote Refinery or other suppliers.
With NNPC no longer covering the differential between Dangote’s selling price and the price to marketers, PMS under recovery will cease to exist as marketers will now buy directly from Dangote and sell at cost price.
What this means is that with marketers adding their own profit margin, it would lead to a hike in the product’s price.
The liberalization will also promote competition and potentially stabilize supply chains.