Marketers Forecast Petrol Price at N1,200/L: NNPC Responds as 6 New Refineries Gear Up for Operations
In a surprising development that has caught many by surprise, gasoline marketers have pegged the price of petrol at N1,200 per litre as six new refineries are on the verge of commencing operations. This isn’t just a change; it signifies a significant shift in Nigeria’s oil industry. The landscape stands to dramatically transform with this advent.
Nigeria’s oil marketers dispute the claim by the Nigeria National Petroleum Corporation (NNPC) that petrol subsidies are a thing of the past.
The NNPC, on the other hand, defends its position by pointing out that petrol subsidies have been eliminated due to the deregulation of downstream petroleum activities.
However, oil marketers suggest a petrol price of N1,200 per litre, attributing this to the devalued naira and the rising cost of crude oil.
Tensions flared between the Nigerian National Petroleum Company Limited and the Independent Petroleum Marketers Association of Nigeria (IPMAN) on Tuesday, January 2, 2024, due to disagreements over the removal of petrol subsidy.
Naira crash forces marketers to demand an increase in petrol prices
Recent economic events have led to the naira taking a hit against the US dollar in both sanctioned and unsanctioned markets. Wothapen reveals that the local currency ended the trading day on Tuesday, January 2, 20224, at N988 per dollar on the NAFEM and N1,225 on the black market.
Bearing this in mind, the dropping value of the naira has professionals and petrol marketers arguing that the cost of petrol subsidies is on the rise. However, the NNPC refutes these claims, standing firm in their stance that they have fully regained the cost of their petrol imports.
NNPC insists subsidy exists
Reports reveal that Bismark Rewane, the CEO of Financial Derivatives Company, has reportedly corrected a prevailing notion. He asserts that the fuel subsidy was not eradicated but slashed. This clarification arises amidst the growing concerns that the fall in the Naira’s value against the US Dollar and rising oil prices may significantly influence the subsidy on petrol.
According to oil marketers, this economic dynamics suggest that in a free market scenario, petrol should be tagged at N1,200 per liter. It is worth noting that the current petrol price, solely imported by the NNPC, ranges between N617 to N660 per litre.
However, Olufemi Soneye, the Chief Corporate Communications Officer of NNPC, rejects this prognosis. Soneye refers to such speculations as mere assumptions while reaffirming the government’s discontinuation of petrol subsidies.
“At NNPC Ltd, we prioritize national development through energy security and sustainable growth. We reiterate that the Nigerian government does not pay subsidies on fuel; we recover total costs from our imported products.
“As a global energy company, we focus on fostering a vibrant and energy-secure Nigeria.”
Nigerian refineries ready to roll as FG gives orders to oil firms
Amid the unfolding developments, numerous refineries across the country are gearing up to start production. In particular, the Port Harcourt refinery is currently in the middle of a test run.
In a strategic move, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has instructed oil firms in Nigeria to supply approximately 483,000 barrels of crude oil to local refineries on a daily basis. This directive is effective for the next six months starting from January 2024.
This latest initiative aligns with Nigeria’s dedicated efforts to provide a steady supply to local refiners, which will primarily cater to domestic consumption.
Six refineries primed to begin operations
Get ready for a new development in Nigeria’s energy sector. Six local refineries are set to kick-off operations next year. This includes the mighty Dangote Refinery with a capacity to process 650,000 barrels per day. It doesn’t stop there. The country’s three established refineries in Port Harcourt, Warri, and Kaduna are also in line for action.
The wheels are already turning for Dangote Refinery. So far, it’s been granted four million barrels of the six million barrels pledged by the Nigeria National Petroleum Company Limited (NNPC). We are on our way to an energized future!
Dangote refinery receives 4th crude oil consignment
A recent report by Wothappen.com revealed that on Thursday, December 29, 2023, Africa’s most expansive refinery celebrated the arrival of another one million barrels of crude oil.
The National Oil Production Regulatory Commission (NUPRC) has issued guidelines dictating the supply of crude to refineries. As per these guidelines, the Dangote refinery is slated to receive a whopping 325,000 barrels of crude daily, leading the pack in supply volume.
After Dangote, another Nigerian refinery begins a test run to start operation soon, NNPC gives an update
In recent news, as reported by Wothappen.com, the Nigerian National Petroleum Company Limited (NNPCL) has kicked off the provision of crude oil for the trial operations of the Port Harcourt Refinery Company Limited.
A confirmation of this development was given and Delta.
In an update from NNPC, they stated this trial run will conclude shortly, setting the stage for full-scale commercial production to begin.