NNPC HIKES PETROL PRICE TO N1,030 PER LITRE
The Nigerian National Petroleum Company Limited (NNPC) has increased the pump price of petrol to N1,030 per litre across various outlets in Nigeria. This sudden adjustment has caused concern among citizens and has been attributed to significant changes in the oil market.
Key Reasons for the Price Increase:
1. End of NNPC's Exclusive Deal with Dangote Refinery: The NNPC has terminated its exclusive purchase agreement with Dangote Refinery. Previously, NNPC had the sole right to purchase petrol from the refinery, but with the deal now off, other marketers can directly negotiate prices with the refinery on a willing buyer, willing seller basis. This change has opened the market for competition, but it also means fluctuating prices for petrol depending on market forces.
2. Price Shift at NNPC Outlets: As of Wednesday, 9 October 2024, several NNPC stations across Nigeria, including those in the Federal Capital Territory (Abuja) and other areas like Wuse and Lugbe, reflected the new price of N1,030 per litre. Motorists and consumers expressed shock at the sharp increase from N897 per litre.
3. Shutdown of NNPC Outlets in Some Areas: Some NNPC outlets, such as those in Akute, Ogun State, were observed to be shut, causing long queues of motorists waiting for fuel.
Background:
The NNPC had previously purchased petrol from Dangote Refinery at N898.78 per litre, selling it to marketers at N765.99 per litre, covering a subsidy of around N133 per litre. However, the company declared this arrangement unsustainable. From mid-September to the end of the month, the NNPC lifted about 103 million litres of petrol from the refinery, but this model could no longer hold, prompting the new market-driven pricing system.
The fuel price hike, amid ongoing concerns about inflation and the economic hardship in Nigeria, has led to widespread concerns about the affordability of transportation and goods.
The Nigerian National Petroleum Company Limited (NNPC) has increased the pump price of petrol to N1,030 per litre across various outlets in Nigeria. This sudden adjustment has caused concern among citizens and has been attributed to significant changes in the oil market.
Key Reasons for the Price Increase:
1. End of NNPC's Exclusive Deal with Dangote Refinery: The NNPC has terminated its exclusive purchase agreement with Dangote Refinery. Previously, NNPC had the sole right to purchase petrol from the refinery, but with the deal now off, other marketers can directly negotiate prices with the refinery on a willing buyer, willing seller basis. This change has opened the market for competition, but it also means fluctuating prices for petrol depending on market forces.
2. Price Shift at NNPC Outlets: As of Wednesday, 9 October 2024, several NNPC stations across Nigeria, including those in the Federal Capital Territory (Abuja) and other areas like Wuse and Lugbe, reflected the new price of N1,030 per litre. Motorists and consumers expressed shock at the sharp increase from N897 per litre.
3. Shutdown of NNPC Outlets in Some Areas: Some NNPC outlets, such as those in Akute, Ogun State, were observed to be shut, causing long queues of motorists waiting for fuel.
Background:
The NNPC had previously purchased petrol from Dangote Refinery at N898.78 per litre, selling it to marketers at N765.99 per litre, covering a subsidy of around N133 per litre. However, the company declared this arrangement unsustainable. From mid-September to the end of the month, the NNPC lifted about 103 million litres of petrol from the refinery, but this model could no longer hold, prompting the new market-driven pricing system.
The fuel price hike, amid ongoing concerns about inflation and the economic hardship in Nigeria, has led to widespread concerns about the affordability of transportation and goods.