By Ella Michaels
The Nigerian National Petroleum Company Limited (NNPC Ltd) has shed light on the dynamics of Premium Motor Spirit (PMS) pricing, attributing fluctuations to foreign exchange (forex) illiquidity and unrestricted free market forces. This revelation comes as the company addresses concerns surrounding the current fuel scarcity and pricing mechanism.
In a press release issued by Olufemi Soneye, Chief Corporate Communications Officer, NNPC Ltd, the company emphasized that the Petroleum Industry Act (PIA) governs PMS prices, which are determined by free market forces. This stance was further reinforced by Adedapo Segun, Executive Vice President of Downstream, NNPC Ltd, during an appearance on TVC News' "Journalists' Hangout" show.
Segun explained that Section 205 of the PIA establishes NNPC Ltd and stipulates that petroleum prices are determined by unrestricted free market forces. He noted, "The market has been deregulated, meaning that petrol prices are now determined by market forces rather than by the government or NNPC Ltd. Additionally, the exchange rate plays a significant role in influencing these prices."
Regarding the current fuel scarcity, Segun assured Nigerians that the situation would "subside in a few days as more stations recalibrate and begin selling PMS." He highlighted NNPC Ltd's efforts to collaborate with marketers and relevant authorities to prevent product diversions and ensure timely deliveries to all stations.
Furthermore, Segun mentioned that NNPC Ltd is awaiting the September 15th timeline for the commencement of lifting PMS from the Dangote Refinery. He emphasized the company's commitment to maintaining adequate fuel supply, with nearly a thousand filling stations nationwide operating extended hours to meet the needs of Nigerians.
In conclusion, NNPC Ltd has reaffirmed that PMS prices are determined by free market forces, as provided for in the PIA. The company is working to address the current fuel scarcity and ensure a stable supply of PMS to meet the demands of Nigerians.
