Korede Abdullah in Lagos
Fuel price in Lagos has risen to between N925 and N935 per litre, following the cancellation of the naira-for-crude agreement between the Nigerian National Petroleum Company (NNPCL) and Dangote Refinery.
The agreement had led to a reduction in the ex-depot price to N825 per litre in February. However, Dangote Refinery has since announced that it would sell its products in dollars (or dollar-naira equivalent) to the domestic market until the NNPC reverts to selling crude in naira.
The increase in fuel price is also attributed to the rise in the landing cost of fuel imported by marketers, which rose from N797 per litre to N843.28 per litre on March 24.
According to the Major Energy Marketers Association of Nigeria (MEMAN), the increase in landing cost is caused by the rise in international crude prices due to the transition from winter to summer specification of petrol in Europe.
MEMAN explained that “seasonal refinery maintenance across Europe and a recent fire at the Falconara Refinery in Italy have further restricted supply, adding to market tightness and price volatility.”
The MEMAN bulletin noted that Nigeria’s foreign exchange rate has been fairly stable, but minimal fluctuations have occurred in recent periods.
As a result, the landing cost of petrol is likely to change several times intra-day. The association advised that savings can be achieved through negotiations, access to forex, and logistics efficiencies.
