IPMAN Forecasts N800 Per Litre Petrol Pump Price after Planned Deregulation
The Independent Petroleum Marketers Association of Nigeria (IPMAN) has projected that the pump price of petrol in Nigeria would rise to between N700 and N800 per litre if the in-coming administration finally deregulates the downstream petroleum sector and abolishes the wasteful subsidy regime.
The National Operations Controller of IPMAN, Mr. Mike Osatuyi, stated this during a chat with THISDAY.
But Osatuyi also predicted that the volume of petrol consumed in the country daily may also drop to about 40 million litres, from the 60 to 70 million litres reported by the Nigerian National Petroleum Company Limited (NNPC).
He urged Nigeria’s president-elect, Mr. Bola Tinubu to deregulate the downstream sector and remove petrol subsidy as he had promised during his campaigns.
Osatuyi also advised Tinubu to set up a committee involving industry players and critical stakeholders including the civil society in order to work out some palliative measures to cushion the adverse effect of the deregulation policy on the poor masses.
“Definitely, he has to deregulate the downstream as he had promised. But while doing that, he has to also talk about palliatives for the masses. Deregulation is the best thing but it will bring up price of petrol to between N700 and N800 per litre which will trigger inflation.
“He needs to put a committee involving the industry players to work out the palliatives, so that some of the gains of the subsidy removal can be channelled to palliatives, so that the masses don’t feel the effects so much. But definitely, deregulation is the best, so that we don’t continue to finance neighbouring countries, because subsidy encourages smuggling.
“You see that what they claim we are consuming in Nigeria will come down to even 40 million litres per day. So, the gain there should be channelled to alleviate the sufferings of the masses based on the increase of the price of petrol. You know, petrol is a security product. So he needs to manage that well, “the IPMAN official told THISDAY.
The Petroleum Industry Act (PIA) signed into law on August 16, 2021 provided for total deregulation of the downstream industry, which implies the removal of subsidy and enthronement of a free market regime for the sector.
But in January 2022, the President Muhammadu Buhari-led government kicked that section of the PIA aside and instead postponed subsidy removal to end of June 2023.
Despite the subsidy regime and the government’s claim that the approved petrol pump price is N185 per litre, the product is still selling between N250 and N600 at many filling stations nationwide, especially the ones owned by IPMAN members.