Fuel price increases: How oil companies exploited Nigerians

*Crude oil price rose 6.2%, Nigerian oil firms increase price by 14.3%

Nigerians are now battling with disproportionate increases in petrol prices at the petrol stations as marketers push retail prices far above rate of increase in crude oil prices.

On Tuesday all petrol stations jerked their pump prices from average N750 per liter to N850 per liter blaming the increase on a similar increase in crude oil prices in the international market which rose from average $64 per barrel to $68 on Monday.

But while the crude oil price increased by 6.2 percent, the local retail price increased by 14.3 percent, indicating that the local oil companies more than doubled the rate of increases in their main input cost, crude oil. The rise in crude prices led to a 14.3 per cent increase in the gantry price of petrol at the Dangote Refinery, which rose from N699 per litre to N799 per litre.

Following the adjustment, petrol retail outlets in Abuja and Lagos as well as other parts of the country, also raised their pump prices.

NNPC Retail outlets increased the price to N835 per litre from N815, while other marketers implemented steeper hikes. AYM Sharfa, for instance, raised its pump price from N815 per litre to N900.

Speaking to Vanguard on the pump price increases, the National Public Relations Officer, Independent Marketers Association of Nigeria (IPMAN), Chief Chinedu Ukadike, blamed the hike on the rise in crude oil price.

He said: “Crude oil price has increased. The refiners have also increased their price. Once your buying source increases, you will increase. Dangote has increased by over 110 Naira”.

On why the marketers raised their pump prices while still having old stock, he said: “When did the crude oil price go up? It is not the first day that it went up. So, that is the nature of the business. Even if we sell our old stock, we can’t buy a new one at the old price. The margin is high. The buying rate and margin is high.

“The marketers have to find a way to see how they can be able to continue to be in business”. (Vanguard)