It has always been assumed that an increase in any section of petroleum activities will result to an increase in fuel price. This time around, it has been confirmed that the Government has its citizens at heart and imposes no change or increase in the price of fuel. Rumour is all over the place that the fuel price will increase soon which has influenced people’s reactions on social media.
To confirm the speculations, the Federal Government has assured Nigerians that it has no plan to increase pump price of premium motor spirit (PMS) otherwise called petrol. Through its agency, Nigerian National Petroleum Corporation (NNPC), Government clarified that the recent increase in bridging allowance to transporters from N6.20 to N7.20 per litre will not lead to an increase in the pump price of petrol as being envisaged in some quarters.
Currently, through the price modulation mechanism, the Government provides a price and of between N138-N145 per litre of petrol which is the same with the old price leading to no increment.
In Abuja on Wednesday, the Chief Operating Officer (COO), Downstream Operations, NNPC, Mr. Henry Ikem Obih, said there was no plan by government or any of its agencies to review the pump price of petrol above N145 per litre.
He further explained that the rise in the bridging cost was achieved after an adjustment was made in the “lightering expenses” from N4 to N3 per litre and the difference transferred to compensate for the cost of bridging within the same template. The bridging allowance refers to the cost element built into the products pricing template to ensure a uniform price of petrol across the country, while lightering expenses involve charges for moving products to depot area from mother vessels by light vessels due to the inability of the former to berth in shallow water depth.
“What happened, in simple language, is a rebalancing of the margins allowed and approved for stakeholders. So what the Petroleum Products Pricing Regulatory Agency (PPPRA) did was to take N1 from lightering expenses and add same to the bridging allowance. That is how we arrived at N7.20. Therefore, PMS remains at the ceiling of N145 per litre,” he said.
On the availability of product supply, the COO confirmed that the country has 1.3billion litres of petrol which translated to an inventory of 36 days. He urged Nigerians to be calm on the issue explaining that the government has great plans to make its citizens happy.
“What this means is that even if we stop importation or refining of petrol right now, we have enough products in-country to provide for the needs of every Nigerian for a period of 36 days,” he said.
It is believed that in such situations like this where there are speculations on fuel price increment, Nigerians working in the oil sector take advantage of the situation to hoard petrol. In the other way, the citizens believe it is the government that is responsible for such. Mr. Henry however urged the Department of Petroleum Resources (DPR) to check and sanction whosoever is caught hoarding the product to create artificial scarcity. He further ensured that there is no cause for alarm as the petrol price still remains the same.
