FCCPC Probes Why Fuel Prices Remain High After Oil Slump

…Vows sanctions on profiteers

The Federal Competition and Consumer Protection Commission (FCCPC) has raised concerns that consumers are not reaping price relief from the recent sharp fall in global crude oil prices.

The commission stated on Sunday that following a market surveillance exercise, the commission said a review of gantry prices from local refiners, marketers, depot operators and retail outlets showed only token reductions, not aligned with the steep drop in international crude prices.

Executive vice chairman and chief executive officer Tunji Bello said the FCCPC does not set petroleum prices in a deregulated market but is mandated by the Federal Competition and Consumer Protection Act, 2018 to promote competition and protect consumers from unfair business practices.

“To be clear, the Commission does not regulate or approve petroleum prices in a deregulated downstream market. Our responsibility under the Federal Competition and Consumer Protection Act, 2018, is to promote competitive markets, prevent anti-competitive conduct, and protect consumers from unfair, deceptive and exploitative business practices,” Bello said.

“We are concerned that while dealers often respond swiftly by hiking pump prices whenever crude prices rise, it is curious that it is taking forever for consumers to benefit significantly when crude prices fall. Competitive markets must work fairly in both directions.”

The commission noted that crude prices fell to about $73 per barrel after a recent ceasefire between the United States and Iran and the reopening of the Strait of Hormuz, down from a peak near $120 per barrel in April. Global crude has returned to roughly February levels.

During the April–May price spike, petrol (PMS) rose to between N1,350 and N1,500 while diesel traded around N2,000. In February, common PMS averaged between N800 and N900. Presently, average retail PMS nationwide is about N1,200, with some local refiners listing gantry prices between N1,025 and N1,075.

The FCCPC acknowledged that domestic fuel prices are affected by multiple commercial factors — including refining costs, foreign-exchange movements, logistics, financing and distribution expenses — but said competitive market dynamics should have passed more of the recent international cost declines to consumers.

“Market liberalisation does not diminish businesses’ obligations to compete fairly or consumers’ right to fair treatment,” Bello added. “Where credible evidence indicates conduct that undermines competition, exploits consumers or otherwise contravenes the Federal Competition and Consumer Protection Act, the Commission will investigate and take appropriate enforcement action.”

The commission urged consumers to report suspected anti-competitive conduct, misleading pricing or other unfair market behaviour via its established complaint channels.