Falling Crude Prices: FCCPC Presses Refiners, Marketers To Slash Petrol Prices

The Federal Competition and Consumer Protection Commission (FCCPC) has stepped up pressure on refiners and petroleum marketers to slash petrol and diesel prices as international crude oil prices continue to decline, insisting that Nigerian consumers must benefit from the reduction in global costs.

The executive vice chairman and chief executive officer of the commission, Mr Tunji Bello, gave the assurance on Tuesday, saying the FCCPC was closely monitoring domestic fuel prices to ensure that the decline in crude oil prices translates into relief for consumers.

Brent crude futures, which reportedly peaked at $115 per barrel in September, have fallen to below $90 this week in the international market.

Despite the decline, petrol prices remain between N1,405 and N1,420 per litre in Abuja and N1,325 and N1,370 in Lagos.

The disparity is more pronounced when compared with prices before the outbreak of the conflict involving the United States, Israel and Iran. On February 27, a day before the war began, Brent crude futures closed at $72.48 per barrel, while petrol sold for between N839 and N925 per litre in Lagos and Abuja.

Petroleum marketers have attributed the surge in domestic fuel prices over the past eight months to volatility in international crude oil prices following the outbreak of the US-Iran conflict in the Middle East and the resulting blockade of the Strait of Hormuz, a major global oil transit route responsible for at least 25 per cent of global oil traffic.

Bello said sustained declines in crude oil prices should translate into lower wholesale and retail prices of petrol and diesel, arguing that refiners and marketers had no justification for keeping prices relatively high if the downward trend continued.

“If the decline in crude prices is sustained, there is no justification for refiners and marketers to continue to keep petrol and diesel prices relatively high. We expect easing in wholesale petrol costs and for the resulting savings to reach consumers at the pump without undue delay,” he said.

Acknowledging the hardship Nigerians had endured due to persistently high fuel prices, Bello said the commission would continue to work with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and other relevant government agencies to monitor wholesale and retail petroleum prices.

He warned that the FCCPC would take appropriate action within its mandate where evidence of anti-competitive conduct or unfair practices showed that refiners and marketers were preventing consumers from benefiting from lower costs.

“Where there is evidence of anti-competitive conduct or unfair practices that prevent consumers from benefiting from lower costs, we will take appropriate action within our mandate,” he warned.

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The Federal Competition and Consumer Protection Commission (FCCPC) has stepped up pressure on refiners and petroleum marketers to slash petrol and diesel prices as international crude oil prices continue to decline, insisting that Nigerian consumers must benefit from the reduction in global costs.

The executive vice chairman and chief executive officer of the commission, Mr Tunji Bello, gave the assurance on Tuesday, saying the FCCPC was closely monitoring domestic fuel prices to ensure that the decline in crude oil prices translates into relief for consumers.

Brent crude futures, which reportedly peaked at $115 per barrel in September, have fallen to below $90 this week in the international market.

Despite the decline, petrol prices remain between N1,405 and N1,420 per litre in Abuja and N1,325 and N1,370 in Lagos.

The disparity is more pronounced when compared with prices before the outbreak of the conflict involving the United States, Israel and Iran. On February 27, a day before the war began, Brent crude futures closed at $72.48 per barrel, while petrol sold for between N839 and N925 per litre in Lagos and Abuja.

Petroleum marketers have attributed the surge in domestic fuel prices over the past eight months to volatility in international crude oil prices following the outbreak of the US-Iran conflict in the Middle East and the resulting blockade of the Strait of Hormuz, a major global oil transit route responsible for at least 25 per cent of global oil traffic.

Bello said sustained declines in crude oil prices should translate into lower wholesale and retail prices of petrol and diesel, arguing that refiners and marketers had no justification for keeping prices relatively high if the downward trend continued.

“If the decline in crude prices is sustained, there is no justification for refiners and marketers to continue to keep petrol and diesel prices relatively high. We expect easing in wholesale petrol costs and for the resulting savings to reach consumers at the pump without undue delay,” he said.

Acknowledging the hardship Nigerians had endured due to persistently high fuel prices, Bello said the commission would continue to work with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and other relevant government agencies to monitor wholesale and retail petroleum prices.

He warned that the FCCPC would take appropriate action within its mandate where evidence of anti-competitive conduct or unfair practices showed that refiners and marketers were preventing consumers from benefiting from lower costs.

“Where there is evidence of anti-competitive conduct or unfair practices that prevent consumers from benefiting from lower costs, we will take appropriate action within our mandate,” he said.