The chief executive officer of the Nigerian National Petroleum Company (NNPC) Limited, Mele Kyari, on Tuesday, said that market forces was behind the increase in petrol pump price from N540 to N617 per litre.
The Informant247 had earlier reported that the price of Petroleum Motor Spirit, PMS, jumped from N539 to N617 per litre in the nation’s capital and other part of the country
Kyari, while addressing the newsmen after a meeting with Vice President Kashim Shettima at the Aso Villa, stated that the increase is not based on a short supply of petrol.
He said, “They are just prices depending on the market realities. This is the meaning of making sure that the market regulates itself. Prices will go up and sometimes they will come down also.”
“No, there is no supply issue. It is not a supply issue.
“When you go to the market, you buy the product, you come to the market and sell it at its prevailing market price. It has nothing to do with supply. We don’t have supply issues.
“We have a robust supply. We’ve had over 32 days of supply in the country. That’s not a problem.”
On his part, the chief executive officer (CEO), Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed said the price hike was a result of rising crude prices, while also attributed the increase to changes in freight rates as well as other ancillary expenses importers incur during distribution.
“So when you say market forces are working, basically what it is, is that you can see the price of crude going up,” he said.
“A week or so ago, the price of crude was hovering around $70 per barrel. Now, it’s over $80 per barrel. So, of course, the crude prices also drive the product price.
“As the importers are importing, they base it on the cost of importation plus the freight plus other costs elements in terms of local distribution.”