Industry operators said on Wednesday said the recent reduction in the ex-depot price of petrol by the Nigerian National Petroleum Corporation (NNPC) was a move to to keep the oil firm competitive, following the commencement of petrol imports by private marketers.

Flavision gathered that the oil corporation had abundant stock and it had to crash its ex-depot price in order not to lose its customers, as more dealers began to import petrol.

Punch reported on Wednesday, May 20th, 2020 that the Petroleum Products Pricing Regulatory Agency had issued permits to private marketers to join the NNPC in the importation of petrol.

For more than two years, the NNPC served as the sole importer of petrol into Nigeria, before the downstream sector was officially liberalised on March 19.

On Wednesday, May 6th, 2020, the NNPC announced a reduction in the ex-depot petrol price from N113.28k per litre to N108 per litre.

Officials at the Abuja headquarters of PPPRA and oil marketers said the national oil firm decided to cut down its ex-depot price, because the cost of petrol might crash once the products of other marketers begin to hit the market.

They said that even though the reduction had not caused a corresponding crash in the petrol pump price, the cost of the commodity at filling stations might drop by next month.

When the NNPC made a reduction in ex-depot price for PMS, there was a serious confusion because people thought that with the move, it would lead to a reduction in pump price. But it didn’t happen,

a senior PPPRA official, who spoke on condition of anonymity said.

The official added,

Now, the reason was that the NNPC made a business decision because the corporation is just like any other marketer right now. The NNPC is going to be importing and selling as much as all other marketers will be importing and selling too.

So, there is no preferential treatment given to anybody at all. What is happening is that the NNPC gave its own business decision because they have a lot of stock.

Remember the NNPC used to be the sole importer of petrol and for it not to lose its customers, it took the business decision of cutting down ex-depot price.

Justin Nwosu

Justin Nwosu is the founder and publisher of Flavision. His core interest is in writing unbiased news about Nigeria in particular and Africa in general. He’s a strong adherent of investigative journalism, with a bent on exposing corruption, abuse of power and societal ills.