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Thursday 15 September 2016

Buhari Finally Responds to Marketers' Call for Increase in Fuel Price

Buhari Finally Responds to Marketers' Call for Increase in Fuel Price

President Muhammadu Buhari

As oil marketers currently clamour for an increase in the price of fuel, President Muhammadu Buhari has waded into the matter with a strong decision.

DailyTrust reports that Nigeria will not increase its fuel prices following a decision by President Muhammadu Buhari who made his stand known to stakeholders in the sector, according to sources at the Aso Rock Villa in Abuja.

Oil Minister Emmanuel Ibe Kachikwu, the head of state oil firm NNPC - Maikanti Baru and the entire government have stepped up efforts to keep fuel flowing into Nigeria without repeating the price increase of May and risking civil unrest.

Shortly before the meeting former Nigerian National Petroleum Corporation (NNPC) bosses had said such an increase may be needed.

A steep devaluation of the naira currency has made sales of petrol at government capped prices unprofitable, marketers say. Months of unrest in the Delta region has also cut Nigeria’s oil output and left as little as half the crude available that it needs to swap for refined motor fuel from trading companies.

“Gasoline is the top priority” for NNPC, said one oil industry source who, like many in Abuja was meeting daily with officials in the oil company. The company, and government, the source said, “will do whatever they can” to stop shortages and keep prices stable.

In a statement last week, NNPC’s Petroleum Products Pricing Regulatory Agency, which oversees downstream regulations, said there was “no basis” for price increase fears, and assured the nation of “uninterrupted supply and distribution.”

Nigeria has four oil refineries, but none of them have been able to run consistently enough to provide Africa’s most populous nation with enough gasoline and diesel - despite its historic position as Africa’s largest oil producer, pumping around two million barrels per day.

That is, before unrest cut output by around a third earlier this year.

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