By Adedotun Ajayi
The increase in petrol price took Nigerians by surprise last week Tuesday with many petrol stations including those of the Nigeria National Petroleum Company Limited (NNPCL) adjusting their pumps to a new price higher than what was being sold.
Commuters and motorists in Akure, Ondo State, have expressed sadness over the latest hike in the pump price of petrol from about N568 per liter to N650.
Our correspondent, who monitored the situation in different parts of the city, reported that both commuters and motorists lamented over the new price of the commodity, saying that the situation “is becoming unbearable”.
The areas visited included Oba Adesida Road, Oke Aro and Alagbaka, where most of the service stations had few customers at the pumps.
The development has resulted in an increase in the intra-city fares by an additional N100 and above.
For instance, fare from Lafe Junction to Post office, which used to cost N200 before, now costs N300 with a lot of haggling, while fare from Oja Oba to Firstbank roundabout in Alagbaka went up from N200 to N400, making it an 100% increase.
Angry motorists who are not happy with the latest development criticized the marketers for selling at N620 per litre of petrol when they are still selling their old stocks and have urged the government to do something about it.
A motorist, at one of the filling stations, Opeyemi Tofunmi, advised the federal government to take a critical look at the abandoned refineries in the country and fix them to stem continuous fuel price increase.
“Sometimes, we Nigerians are our own problem, because I’m sure many filling stations are still selling old stock, so why increase the price on old stock? that is really unfair. Even if the fuel is to N1000 per litre, these marketers know citizens have no option, like me, my car just stopped and I couldn’t move, so I have to buy and maybe take the car home and park it because it is not funny.
“My appeal to the government is that this development is becoming unbearable for the masses, if they know that they want to really do well as a government, let them see how they can put our refineries in order so that they will not be telling us that they are paying money to bring the product back.
“When they take the crude oil out they tell us they are paying higher money to bring it back, if our refineries are working, all these things won’t be like this,” Opeyemi said.
A commercial driver, Oluwaseun Adebanjo, who also spoke with our correspondent lamented the new price, which he described as unfair as he is still battling with other macroeconomic challenges.
“This is from frying pan to fire, I bought 10 litres for N6,000 plus. I can’t even afford to fill my 50 litres tank at this rate, and I can’t even work with this because how much am I expected to charge passengers,” Oluwaseun, an Akure taxi driver, said.
The Hope observed that some shops despite not having electricity did not use generator as business owners preferred to wait for power to return.
Tosin Olubunmi, who has a beauty saloon, was not willing to attend to customers, even though she had fuel which she bought on Saturday. She said she had to be strategic with how she would use the fuel.
“I can’t offer my services at the usual price again, and if I don’t have many customers I won’t use the generator. I’ll rather wait for the power distribution company to restore power and people that can’t wait can go elsewhere or bring fuel that I will use,” she said.
As Nigerians continue to groan over the new fuel price regime, the National Operations Controller of the Independent Marketers Association of Nigeria (IPMAN), Mr Mike Osatuyi gave reasons for the hike, he said increase in crude oil prices in the international market brent crude benchmark price had surpassed $80 per barrel for the first time since May 2023. This is a sign that supply is gradually tightening and demand is expanding.
This happened after Saudi Arabia agreed to cut its output to firm up oil prices, reflecting in one million barrels reduction per day from June.
Another factor that led to the increase in fuel price to be sold at N617 per litre was the hike in the exchange rate between the naira and the US dollar which closed at N795.28/$1 at the official Investor and exporters window.
This was established after the order by the President that there should be a unified exchange rate. On Monday, July 17, 2023, it traded N820/$1 at the unofficial I&E Window.
Petroleum is imported with foreign currency. The imports by many companies have not arrived in the country as they needed more naira to put into dollars in order to import.
With the dwindling power of the naira, currently going for more than N800 to a dollar, they need more naira in order to import. Naira is becoming cheaper than before.
Will the price fall in the future?
As debates go on whether the prices of fuel will drop from the current N617 per litre, it should be noted that this will depend on market forces.
It is expected that the price will drop based on the competition, increase in supply will eventually impact the domestic market later.
Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL) claimed that fuel pump prices in the country, are reflective of the current market price of the commodity.
