FG Engages Marketers To Ensure Falling Global Oil Prices Reflect At Fuel Pumps

The Federal Government says it is engaging petroleum marketers and industry regulators to ensure that the recent decline in global crude oil prices translates into lower petrol pump prices for consumers, while maintaining fairness and competition in the downstream petroleum sector.

The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Monday while speaking with journalists after the Federal Executive Council (FEC) meeting in Abuja.

Edun explained that discussions were ongoing with operators in the downstream petroleum industry on ensuring that changes in international crude oil prices are reflected in domestic fuel prices.

According to him, marketers often adjust pump prices upward quickly when global crude oil prices rise because of higher replacement costs but tend to delay price reductions when international prices fall, citing the need to sell existing stock purchased at higher prices.

"We are engaging with marketers and regulators to ensure there is fairness in the market while also recognising the commercial realities operators face," he said.

The minister said the Federal Competition and Consumer Protection Commission (FCCPC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) were already addressing the issue within the provisions of the Petroleum Industry Act (PIA).

His comments come amid growing public concerns that recent declines in global crude oil prices have yet to result in corresponding reductions in the retail price of petrol across the country.

The FCCPC had earlier warned that although it does not regulate petroleum prices under the deregulated market, it would take action against businesses found to be engaging in exploitative pricing or anti-competitive practices.

Addressing concerns over the cost of transportation, Edun said the Tinubu administration had introduced several measures to cushion the impact of volatility in global energy prices on Nigerians.

He noted that the government had suspended the Value Added Tax (VAT), excise duty and other charges on petroleum products to help moderate fuel costs.

According to the minister, petrol prices in neighbouring countries remain between 20 and 50 per cent higher than in Nigeria because those countries continue to impose such taxes on petroleum products.

Edun also urged transport operators benefiting from the Federal Government's Compressed Natural Gas (CNG) initiative to pass the cost savings on to commuters.

He observed that despite receiving subsidised vehicle conversion kits and other forms of government support, some CNG operators were still charging the same transport fares as operators using petrol-powered vehicles.

The minister sid the Federal Government had invested heavily in the CNG programme to reduce transportation costs, improve energy affordability and lessen the country's dependence on petrol.

He called on beneficiaries of the initiative to support the government's efforts by ensuring that Nigerians enjoy the intended economic benefits of the programme through lower transport fares.