By Emmanuel Adeleke
The Group Chief Executive Officer (CEO) of Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari, has blamed market forces for the increase in petrol pump price from N500 to N617 per litre.
Speaking with State House correspondents after a meeting with Vice President Kashim Shettima on Tuesday, Kyari said the increase was not based on a short supply of petrol.
“They are just prices depending on the market realities. This is the meaning of making sure that the market regulates itself. Prices will go up and sometimes they will come down also.
“There is no supply issue. It is not a supply issue.
“When you go to the market, you buy the product, you come to the market and sell it at its prevailing market price. It has nothing to do with supply. We don’t have supply issues.
“We have a robust supply. We’ve had over 32 days of supply in the country. That’s not a problem,” he said.
Also, the Chief Executive Officer (CEO), Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed said the price hike was a result of rising crude prices.
He also attributed the increase to changes in freight rates as well as other ancillary expenses importers incur during distribution.
“So, when you say market forces are working, basically what it is, is that you can see the price of crude going up.
“A week or so ago, the price of crude was hovering around $70 per barrel. Now, it’s over $80 per barrel. So, of course, the crude prices also drive the product price.
“As the importers are importing, they base it on the cost of importation plus the freight plus other cost elements in terms of local distribution,” he said.
President Bola Tinubu had in his inaugural address on May 29, announced that petrol subsidy is gone.
Subsequently, NNPC increased the price of petrol at its retail outlets to between N488 and N537 per litre.