Reps want price of petrol reduced to N70

The House of Representatives has advised the Petroleum Products Prices Regulatory Agency (PPPRA) to review the current price template for petrol and reduce the price to N70.

The call followed a motion by a member, Abubakar Fulata, titled “Urgent Need to Review the Petroleum Price Template”.

The lawmaker expressed disappointment recent reports suggesting the government may again increase the price of petrol in the country.

The government has denied the report.

Mr. Fulata said the current template for petrol pricing could be reviewed downwards without affecting the profit margin of marketers and transporters.

“I am aware that the current cost of freighting PMS stands at N109.1, Lightering expenses N4.56, Nigeria Ports Authority charges N0.84, NIMASA charges N0.22, Financing N2.51 and Jetty put charges at N0.60.

“Storage charges N2.00, retailers margin N6.00, transport allowance N3.36, dealers margin N2.36, bridging fund N6.20 and marine transport average put at N0.15 bringing the total cost to N137.81,” he said.

He said the landing cost of petrol remained N119.74, while the distribution cost and margins of marketers stood at N18.37.

“Thus, the total of both the landing and distribution costs is N138.11, while marketers are allowed to sell the product within the range of N140 and N145 per litre,” he said.

The lawmaker said over 90 per cent of the current price of petrol in Nigeria is accounted for by transport related charges amounting to N124.34.

He said that foreign vessels charge higher for lifting petrol because Nigerian carriers that were supposed to lift 50 per cent of the products lack the capacity to do so.

Mr. Fulata said the NPA’s inability to dredge the ports despite collecting N0.84 for every litre of petrol, had caused Nigerian users to pay N4.56 for every litre of petrol they buy.

“Bridging is supposed to be an annual event only when refineries are carrying out their turn around maintenance which should not exceed three months,” he said.

“However, due to the fact that pipelines linking the various depots have been vandalised or in a state of disrepair, bridging has remained a permanent feature of the oil industry in Nigeria.”

He said if the pipelines linking the various depots and refineries could be fixed and secured, the bridging fund could be reduced to N2.00 per litre instead of the current N6.20.

“Also a realistic template would bring down the price of petrol to N70.04,” he added.

The House urged the NPA to dredge all harbours within a period of one year to enable ships dock in them.

The House also set up an ad-hoc committee to liaise with the Federal Ministry of Petroleum Resources on the review of the price of petrol.