NNPC Ltd. attributes PMS price fluctuations to free market forces, exchange rates
… scarcity will ease within a few days as more filling stations recalibrate, resume sales
By Thelma Tokunbo
The Nigerian National Petroleum Company Limited (NNPC Ltd.) has identified the illiquidity of foreign exchange (forex) as a key factor contributing to the fluctuation in Premium Motor Spirit (PMS) prices, which are governed by free market forces under the Petroleum Industry Act (PIA) of 2021.
This was disclosed by Mr. Adedapo Segun, Executive Vice President of Downstream, NNPC Ltd., during an appearance on TVC News’ “Journalists’ Hangout” on Thursday.
His comments were further supported by a statement released by Olufemi Soneye, Chief Corporate Communications Officer of NNPC Ltd., and obtained by Advisors Reports.
Segun explained that PMS prices are now determined by market dynamics as stipulated by Section 205 of the PIA, which established NNPC Ltd.
He emphasized that deregulation of the downstream petroleum sector means prices are no longer controlled by the government or NNPC Ltd. but are instead influenced by global market conditions.
He added, “The exchange rate plays a significant role in influencing these prices.”
Regarding the ongoing fuel scarcity, Segun noted that the situation is expected to ease within a few days as more filling stations recalibrate and resume PMS sales.
He reassured the public that NNPC Ltd., which operates nearly a thousand filling stations across the country, is working with marketers to ensure stations open early, close late, and maintain adequate fuel supply.
Additionally, he addressed concerns about lifting PMS from the Dangote Refinery, stating that NNPC Ltd. is awaiting the September 15, 2024, timeline provided by the refinery for operations to commence.
Segun concluded by affirming that NNPC Ltd. is engaging with relevant authorities to prevent product diversions and ensure timely deliveries to all stations, thus mitigating the scarcity.
“The scarcity should ease in the next few days as more stations recalibrate and begin operations,” the Executive Vice President of Downstream, NNPC Ltd. assured Nigerians.