In a meeting with Vice President Kashim Shettima at Aso Rock on Tuesday, July 18, 2023, Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC) Limited, addressed the recent surge in pump prices of Premium Motor Spirit (PMS), commonly known as petrol. Kyari clarified that the price increase is primarily due to market forces, following the deregulation of the oil sector.
Kyari emphasized that with the deregulation, petrol prices will be influenced by prevailing market realities, leading to fluctuations in prices both upwards and downwards. He assured Nigerians that there is an ample supply of petrol, dismissing claims that the price increase is linked to supply shortages. According to Kyari, the NNPC’s marketing team is responsible for price adjustments, ensuring the self-regulation of the market.
In agreement with Kyari’s stance, Farouk Ahmed, Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), echoed the role of market forces in determining petrol prices.
Despite the assurances from the NNPC, queues for petrol resurfaced in cities across Nigeria, including Lagos, Abuja, and Port Harcourt, as the pump price soared from ₦184 to over ₦617 on the same day. The price surge has resulted in criticism and discontent among citizens already struggling with economic challenges.
The sharp increase in fuel prices comes amid the unification of foreign exchange rates by the Tinubu administration and soaring inflation rates. The National Bureau of Statistics reported a record 22.79% inflation rate in June, with food inflation reaching 25.25% year-on-year, surpassing the previous year’s figures.
To address public discontent, the government announced plans to disburse ₦500 billion as a palliative measure to alleviate the impact of rising fuel prices and food inflation. The proposed initiative would offer ₦8,000 to 12 million households over a six-month period. However, this move has been met with rejection from Organised Labour and rights activists, who believe it may not effectively address the root causes of the economic challenges faced by Nigerians.
