Crude oil refiners and downstream sector players have pointed to the foreign exchange (forex) crisis as a significant factor behind the high cost of locally refined Premium Motor Spirit (PMS), commonly known as petrol. They explained that dollar-based charges on locally refined petrol and the cost of importing crude oil are driving up domestic prices.
As of December 5, 2024, data from the Major Energies Marketers Association of Nigeria (MEMAN) indicated that the cost of landing imported petrol was N958.89 per litre, while locally refined petrol from the Dangote Petroleum Refinery was priced at N970 per litre, and the Port Harcourt Refining Company’s refined petrol stood at N1,030 per litre.
Operators highlighted that charges on locally refined petrol, including jetty charges, remain in dollars, which significantly impacts the pricing of the product. The Crude Oil Refinery Owners Association of Nigeria (CORAN) noted that such dollar-based charges contribute to the high cost of local petrol, stressing that the government should shift these fees to naira to help reduce costs.
The Nigerian Maritime Administration and Safety Agency (NIMASA), along with the Nigerian Ports Authority (NPA), have been urged to convert their dollar-based charges to naira, following directives from the President to sell crude in naira and maintain local currency pricing for domestic refined products.
The forex crisis, combined with other operational challenges, including the importation of crude and fluctuating global oil prices, complicates the pricing structure for locally refined petrol. Operators are calling for more adjustments to ensure fair pricing for consumers.
