The Federal Government has called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to rein in oil marketers and ensure a reduction in the pump prices of petroleum products in line with the decline in global crude oil prices.
The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, made the call on Monday in Abuja during a meeting with oil marketers and other stakeholders on cost-reflective pricing of petroleum products, organised by the NMDPRA.
According to Lokpobiri, the meeting was convened to bring industry players together to discuss measures to reduce the prices of petroleum products and boost consumer confidence in the sector in line with existing rules and regulations.
The minister said, “I urge the Authority to strengthen market surveillance and enforce pricing transparency across the supply chain to ensure that reductions in underlying costs are reflected promptly in ex-depot and retail prices. Equally, there is an urgency for the NMDPRA to accelerate the operationalisation of the National Strategic Stock (NSS). The NSS will strengthen national energy security, reduce exposure to supply disruptions, and moderate price volatility.”
Lokpobiri stated that over the last six months, the international crude oil market had experienced significant volatility. He said Brent crude traded between $61 and $65 per barrel in January, rose to over $118 per barrel in April amid heightened geopolitical tensions in the Middle East, and has recently declined to about $71 per barrel as tensions eased.
He said he expected the changes in crude oil prices to be reflected in the prices of refined petroleum products, reiterating the Federal Government’s commitment to protecting consumers and the public interest.
He added, “While the initial increase in crude prices understandably exerted upward pressure on PMS prices, the subsequent moderation in crude oil prices has not translated into a commensurate reduction in pump prices across the domestic market, with PMS peaking at N1,596 per litre in May and dropping to N1,296 per litre as of today. This disconnect has understandably raised concerns.
“I am aware that PMS pricing is influenced by several factors beyond crude oil prices, but it is equally important to distinguish between genuine replacement cost and windfall gains arising from inventory management. As inventories are replenished at lower costs, the benefits of those lower costs should be transmitted to consumers in a timely and transparent manner. That is the essence of a competitive and efficiently functioning market.
“Deregulation was never intended to create opportunities for excessive pricing or market distortions but rather to promote efficiency, deepen competition and ultimately deliver value to Nigerians.”
Speaking at the meeting, the Chief Executive Officer of the NMDPRA, Rabiu Umar, said, “Recently, we have witnessed a welcome easing of those tensions, which has driven a downward shift and moderation in global crude prices.
“As a responsible regulatory authority, it is our duty to step in alongside you, our valued partners, to interrogate the market forces, understand the operational bottlenecks, and directly address this disconnect between falling replacement costs and sustained retail prices.”
He added, “His Excellency, President Bola Ahmed Tinubu, has laid a resilient foundation for a deregulated, competitive and investment-driven market. But let me be clear: deregulation is not a licence for market distortion or unfair consumer pricing. It is intended to drive efficiency, maximise value and protect the public interest.
“We need to build a transparent ecosystem where the benefits of market improvements are passed down to the Nigerian consumer in a timely and fair manner.”
Among those who attended the meeting were representatives of TotalEnergies, Eterna, Matrix Energy, the Depot and Petroleum Products Retailers Association of Nigeria (DPPRAN), the Major Energy Marketers Association of Nigeria (MEMAN), the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), the Independent Petroleum Marketers Association of Nigeria (IPMAN), the Nigerian Association of Road Transport Owners (NARTO), and officials of the NMDPRA.