The Federal Government says it is engaging petroleum marketers and industry regulators to address concerns over fuel pricing and ensure Nigerians benefit from falling global crude oil prices.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Monday while responding to questions from journalists after the Federal Executive Council (FEC) meeting in Abuja.
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Mr Oyedele said discussions were ongoing with operators in the downstream petroleum sector on how changes in international crude oil prices should be reflected in domestic pump prices.
According to him, marketers often increase fuel prices almost immediately when crude oil prices rise, citing higher replacement costs, but are generally slower to reduce prices when international prices decline because they still have existing stock purchased at higher costs.
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“We are engaging with marketers and regulators to ensure there is fairness in the market while also recognising the commercial realities operators face,” he said.
He added that the Federal Competition and Consumer Protection Commission (FCCPC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) were already addressing the issue within the framework of the Petroleum Industry Act.
PREMIUM TIMES had earlier reported that the FCCPC raised concerns that recent reductions in global crude oil prices had not translated into corresponding cuts in fuel prices across the country. The consumer protection agency warned that although it does not regulate petroleum prices, it would not hesitate to sanction businesses found engaging in exploitative pricing or other anti-competitive practices in the deregulated downstream market.
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Responding to concerns that government interventions have yet to significantly reduce transportation costs, Mr Oyedele said measures introduced by the President Bola Tinubu administration had helped cushion the effects of volatility in global energy prices.
READ ALSO: Oil prices tumble as US, Iran reach peace deal
He noted that the government suspended the Value Added Tax (VAT), excise duty and other charges on petroleum products to reduce costs for consumers.
According to him, petrol prices in neighbouring countries remain between 20 and 50 per cent higher than in Nigeria because such taxes are still applied there.
CNG operators urged to reduce fares
The minister also called on transport operators benefiting from the Federal Government’s compressed natural gas (CNG) initiative to pass the savings on to commuters.
He said that despite receiving subsidised vehicle conversion kits and other government support, some operators continued to charge the same fares as petrol-powered vehicles.
Mr Oyedele said the government had made substantial investments in the CNG programme to lower transportation costs and reduce dependence on petrol.
He urged beneficiaries of the initiative to play their part by ensuring Nigerians enjoy the intended benefits of the government’s intervention.
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