The Nigerian National Petroleum Company (NNPC) Limited has reduced the ex-depot price of Premium Motor Spirit (PMS), commonly known as petrol, from N1,020 to N899 per litre.
This price adjustment, aimed at responding to the competitive dynamics introduced by deregulation, is expected to intensify competition among oil marketers and lead to cost savings for consumers.
Joseph Obele, the National Public Relations Officer of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), disclosed the development in a statement shared with Advisors Reports on Saturday.
The announcement coincides with Dangote Refinery’s partnership with MRS, which has set the retail price of petrol at N935 per litre across its outlets nationwide. This follows a reduction in its ex-depot price from N970 to N899.50 per litre.
Obele noted that NNPCL’s decision reflects the growing competitive pressures in the downstream sector since deregulation was introduced. He highlighted that this move underscores the positive impact of market-driven competition within the industry.
PETROAN commended NNPCL for the price reduction, emphasising its importance in making petrol more affordable for Nigerians.
According to PETROAN, the new regional pricing structure sets petrol at ₦899 per litre in Lagos and ₦970 per litre in Warri, Oghara, Port Harcourt, and Calabar.
Expressing optimism, Obele predicted that PMS prices might drop further by the end of January 2025. He attributed this potential decrease to the global decline in crude oil prices and the recent appreciation of the naira against the dollar.
Billy Harry, PETROAN’s National President, described the price cut as a much-needed relief for motorists and Nigerians, especially during the festive season. He hailed the development as a positive step toward easing the financial burden on citizens.
“The reduction in PMS price by NNPCL is a demonstration of the company’s commitment to making petroleum products more affordable for Nigerians.
“We commend NNPCL for responding to our call for affordable PMS prices,” Harry said.
Billy Harry outlined the significant advantages of the recent petrol price reduction, particularly for consumers.
He explained that lower fuel costs will reduce transportation expenses, enabling motorists to save on fuel and increase their disposable income.
In addition, the reduction is expected to boost economic activity by lowering production costs, which will drive demand for goods and services.
He noted that the decrease in fuel prices would enhance Nigerians’ standard of living by reducing the cost of living and making basic necessities more affordable.
Harry commended Dangote Refinery for its earlier move to lower petrol prices, attributing it to heightened competition in the downstream petroleum sector.
He acknowledged the refinery’s role in fostering a competitive environment that benefits consumers and the economy.
Referencing a report by technical pricing team, Harry highlighted the benefits and challenges of competitive pricing.
The report emphasised that competitive pricing allows companies to strategically position themselves in the market, attract new customers, and increase sales by offering more favourable pricing.
While acknowledging the benefits, Harry cautioned that competitive pricing could sometimes compromise product quality.
He urged PETROAN to collaborate with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to ensure strict adherence to quality assurance standards across the industry.
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