The Minister of Petroleum Resources (Oil), Senator Heineken Lokpobiri, has assured stakeholders in the oil and gas sector of continued collaboration with the Federal Government. He, however, stressed that fuel prices in Nigeria will always be determined by market forces in a deregulated market.
Lokpobiri spoke at the Petroleum Industry Stakeholders Forum Meeting in Abuja, which gathered government agencies and private sector players. The forum aimed to build consensus on policies to improve the oil and gas industry.
Deregulation and Price Fluctuations
The minister explained that in a deregulated market, it is normal for fuel prices to rise or fall based on global crude oil prices. He noted that Nigeria cannot escape this reality, as the cost of fuel worldwide is linked to crude oil prices.
He said:
“In a deregulated market, no one can guarantee whether prices will rise or fall. The international crude oil price determines this, and Nigeria is no exception.”
Lokpobiri highlighted that deregulation allows fuel prices to adjust naturally based on market conditions. He also shared that during the last festive season, petrol prices dropped as low as ₦999 per litre in Bayelsa State, reflecting market competition.
Government’s Role in a Deregulated Market
The minister outlined the government’s focus under deregulation: ensuring fuel availability, maintaining quality, and preventing consumers from being cheated at fuel pumps.
He added:
“Our main concern is to ensure quality control, availability of products, and fair dispensing of fuel. If a customer pays for 10 litres, they should get 10 litres.”
Lokpobiri also credited the absence of fuel queues in recent weeks to healthy competition in the deregulated market.
Industry Reactions
Huub Stockman, Chairman of the Major Energy Marketers Association of Nigeria (MEMAN), stated that while crude oil prices impact petrol costs, other factors also play a role. He noted that a rise in crude oil prices does not always lead to an immediate increase in petrol prices.
“There is often a correlation between crude and fuel prices, but it’s not always direct or immediate,” Stockman said.
Alhaji Abubakar Maigandi, President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), said his members have been lifting products directly from Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPCL). This has allowed them to sell fuel at lower prices, maintaining a uniform price of ₦935 per litre.
Recommendations for the Industry
Dr. Billy Hary, National President of the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN), suggested holding the forum quarterly to ensure policies are well-discussed before implementation.
Wole Ogunsanya, a representative of the Petroleum Technology Association of Nigeria (PETAN), praised the government’s efforts to increase oil production to meet Nigeria’s OPEC quota. He called for policies to sustain production levels and minimise the impact of fluctuating oil prices on the economy.
Ogunsanya said:
“The Middle East ensures consistent oil and gas production year after year. We need similar policies in Nigeria to avoid the boom-and-bust cycles.”
The forum ended with a renewed commitment to collaboration among stakeholders to strengthen Nigeria’s oil and gas sector.
