Why Nigerians Are Yet to Enjoy Fuel Price Crash Despite Global Oil Price Drop
Market Forces and FX Rates Keep Fuel Prices High
The Independent Petroleum Marketers Association of Nigeria (IPMAN) has explained why the renewal of the naira-for-crude deal between the Nigerian government and refiners like Dangote Refinery hasn’t led to significant fuel price reductions.
According to IPMAN spokesperson Chinedu Ukadike, two key factors are maintaining current petrol prices:
- Market forces of demand and supply
- Depreciation of the naira against the dollar
Global Oil Price Decline vs Local Reality
Despite global crude prices dropping to $65 per barrel (Brent) and $61 (WTI), Nigerians continue paying between N940-N975 per liter in Abuja. This disconnect has raised concerns among consumers.
Recent factors affecting global oil markets include:
- US-China tariff disputes
- OPEC+ supply cut agreements
- US tariff policy adjustments
Consumer Frustrations Grow
Abuja resident Nurudeen Abdullahi expressed disappointment: “With crude at $65/barrel, petrol should cost no more than N850/liter.”
Evelyn Adebayo added: “Marketers implement price hikes immediately but drag feet on reductions.”
Dangote’s Modest Reduction
The Dangote Refinery recently announced a N10 reduction in ex-depot petrol prices following government commitments to continue the naira-for-crude arrangement.
However, Ukadike maintains current prices reflect economic realities: “The forces of demand and supply and FX rates make current petrol prices competitive.”
As of Tuesday, the official exchange rate stood at N1,604.48/$1, significantly impacting fuel pricing.
Source: NigerianEye.com