The Federal Government (FG), has disclosed why it will not yet allow marketers to single-handedly determine the price of petrol, despite the full deregulation of the downstream sector.
The disclosure was made on Thursday by the Minister of State for Petroleum Resources, Timipre Sylva, during a media session organized to provide a status update on the operations of the oil and gas industry.
The Minister said that the government needs to protect the general public from undue exploitation and prevent inordinate profiteering by oil marketers. He said this has made it mandatory for the Federal Government to closely monitor the price of premium motor spirit (fuel) which currently stands deregulated.
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“The role of government in a deregulated environment was to provide a shield for the teeming consumers through the operations of the Petroleum Pricing Regulatory Agency (PPPRA) which would use its price modulation mechanism to engender a market-driven price regime.
‘’I am not just announcing deregulation today and let us understand ourselves about deregulation. Deregulation was approved on the 19th of March, this year… but as you all know, PMS and other petroleum products are very strategic commodities, so you cannot allow the prices of these commodities to be determined wholly by the marketers.
‘’Anywhere in the world, if you want to buy anything, you have what is called the recommended retail price, the consumer protection agency would fix a price a price so that nobody can profiteer inordinately from the people,” the Minister said.
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PRESS STATEMENT
Why FG Won’t Allow Marketers to Wholly Determine Price of Petrol – @HETimipreSylva
…Says Deregulation of Downstream Sector Approved Since March
Read 👉🏽 https://t.co/IMny5mxE5F pic.twitter.com/EFFbIacSfi
— Ministry of Petroleum Resources, Nigeria (@FMPRng) May 15, 2020
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He also explained that because of the volatile nature of the price of petroleum products, especially PMS, the ministry is working closely with stakeholders in the Petroleum Industry to introduce an alternate fuel via the revamp and aggressive introduction of Compressed Natural Gas (CNG). While pointing out that CNG is a lot more stable and cheaper fuel, he also noted that its introduction would provide consumers with a viable alternative.
In the meantime, the Ministry is working on an extensive LPG penetration campaign which, apart from providing a veritable source of cooking fuel, would also serve as a massive outlet for job creation across an expanded value chain.
The Minister said that despite the challenges posed by the raging COVID-19 pandemic, the petroleum industry in the country is planning ahead to ensure a rewarding future for stakeholders in the industry.