The Petroleum Products Retail Outlets Owners Association of Nigeria says the hike in the pump price of petroleum may be due to an increase in the landing cost of the commodity.
“What I can tell you is, once there is difficulty in landing products by NNPCL and the size of shock absorbing that they (NNPCL) can do become overwhelming, they will certainly shed some of the loads,” PETROAN president Billy Gillis-Harris said when he was featured on a live television programme on Thursday.
“I think that’s what would have happened.”
On Wednesday, retail outlets of the Nigerian National Petroleum Company Limited increased the pump price of the commodity in Lagos and Abuja.
It was observed that NNPCL outlets in Lagos sold a litre of petrol for ₦998 which is ₦150 higher than the initial price of ₦855.
The situation is similar in the nation’s capital of Abuja where the pump price of a litre of the commodity went to ₦1,030 from ₦897.
That move triggered a hike in the price of the commodity in other filling stations.
It sold for ₦1,050 in some parts of Lagos State.
NNPCL’s most recent move came months after a similar adjustment in the pump price of the commodity.
The retail firm pushed the cost per litre of fuel from ₦568 to ₦855.
In September, the NNPCL acknowledged huge debts to fuel suppliers and announced a roughly 40-percent price increase to help its finances.
But the PETROAN boss said the prices of the commodity will be determined by market forces.
“The truth right now is that petrol prices are going to be determined by the forces of demand and supply,” he said on Thursday.
“This does not mean that the prices will always be high. Remember that our dollar exchange value is going to impact very highly on the cost of PMS because we are operating a dollarized business in naira.”
Gillis-Harris said that with the Dangote Refinery coming on board, there may be succour for Nigerians.
“This is what we thought that the Dangote Refinery and other refineries in Nigeria should come to the rescue,” he said.
After coming to power last year, President Tinubu said his reforms would revive the economy in the long term and attract foreign investment.
But Nigerians have seen inflation hit a three-decade high since Tinubu ended a fuel subsidy and floated the naira currency.
Before the reforms, petrol was sold for less than N200 per litre.
In the wake of the recent adjustment, the Nigeria Labour Congress said it was “dismayed” by the hike and called for its immediate reversal.
“In light of this, we urge the government to immediately reverse this rate hike as previous increases did not produce any good results. People only got poorer,” the NLC said on Wednesday.
But rallies over economic hardship struggled to build momentum earlier this month following a deadly crackdown by the authorities on nationwide demonstrations in August.
In his Independence Day speech, Tinubu again called for patience with the reforms of his government.
