…hike in petrol price inevitable, says IPMAN
BY ODUNEWU SEGUN
SPECULATIONS over proposed hike in the pump price of premium motor spirit otherwise called petrol topped the agenda of a one-day meetings of top oil & gas management gurus where it was proposed that the price cap of N145 per litre for petrol be removed.
Citing the dwindling value of the naira and other price determining components such as crude cost, Nigerian Ports Authority charges, the meeting attended by Dr. Maiknti Kacalla Baru, GMD of NNPC, alongside immediate past GMD, Minister of State for Petroleum, Dr. Ibe Kachikwu and ten other former GMDs, said the present N145/litre is not consistent with the liberalization policy.
Among their concern is the declining production level and its attendant consequences on the environment and the nation’s revenue. According to a press statement issued by Garba Deen Muhammed, Group General Manager, Public Affairs Division of the NNPC, the past and present bosses of NNPC agreed that if the current situation remains unchecked, it could lead to the crippling of the Corporation and the nation’s Oil & Gas Sector, the mainstay of the Nigerian economy.
Similarly, the National President of Independent Petroleum Marketers Association of Nigeria (IPMAN), Elder Chinedu Okoronkwo said a review of the pricing is the only to engendered competition in the system.
He said investors are still afraid to invest in the sector because of the price protection, stressing that full deregulation is the only answer, insisting that even at N145, there is still an indirect subsidy.
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Elder Okoronkwo argued that if the Federal Government removed the cap, investment will begin to flow into the sector and the issues of Modular refineries will encouraged.
Meanwhile, the Petroleum Products Pricing Regulatory Agency (PPPRA) and oil marketers in the downstream sub-sector have reaffirmed that the price band of N135-N145 is what currently obtains, and that there are no plans to review nor hike the price.
In a joint statement signed by the Acting Executive of Petroleum Products Pricing Regulatory Agency (PPPRA), Sotonye Iyoyo, the Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN), Obafemi Olawore and the Executive Secretary, Depot and Petroleum Products Marketers Association (DAPPMA) Olufemi Adewole, stated that speculation of an imminent upward price review pf PMS was unfounded.
Commenting on the issue, Head of Energy Research at Ecobank Capital, Mr. Dolapo Oni explained that the current template was adopted when the Dollar was about N315 in the parallel market and the Naira had not been floated then. He submitted that the best solution will be to take the last plunge and just remove cap on prices.