The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has warned that the pump price of Premium Motor Spirit (PMS) may hit N2,000 per litre amid the ongoing Middle East tension.
PETROAN urged the Nigerian National Petroleum Company Limited (NNPCL) to urgently strengthen domestic refining capacity as a strategic step to shield Nigeria from the global petroleum market shocks.
The National President of PETROAN, Billy Gillis-Harry, made the call in Port Harcourt while delivering a keynote address titled “Deconstructing Energy Trilemma,” organised by the Department of Petroleum Economics and Policy Studies at Ignatius Ajuru University of Education.
This is according to a statement signed by the National PRO of PETROAN, Dr. Joseph Obele, obtained by Nairametrics on Monday.
What PETROAN is saying
The association specifically called on the Group Chief Executive Officer of NNPC Ltd., Bayo Ojulari, to facilitate the immediate commencement of production at Nigeria’s local refineries, particularly the Area 5 Plant at the Port Harcourt Refinery and the Warri Refinery.
Harry noted that the ongoing conflict involving Israel, the United States, and Iran is pushing global petroleum prices to alarming levels.
- “Sustained drone and missile attacks now threaten critical oil routes and infrastructure, creating uncertainty in global supply chains,” the statement said.
He noted that with no clear end to the conflict, petroleum product prices in both international and domestic markets are expected to rise sharply in the coming days.
- He explained that before the crisis, Premium Motor Spirit (PMS) sold at N774 per litre but now sells above ₦1,000 per litre, representing an increase of about 30%.
- Automotive Gas Oil (AGO), also known as diesel, previously sold at N950 per litre but has risen to N1,400 per litre and above, an increase of about 49%.
Projecting future trends, he warned that PMS could rise close to N2,000 per litre while AGO may approach N3,000 per litre if the situation persists.
PETROAN insists on local refining
Harry emphasised that rehabilitating Nigeria’s refineries for immediate domestic production is critical.
Local refining, he said, would reduce exposure to international market volatility, especially as Nigeria has abundant crude oil resources under the custody of the NNPC Ltd.
- He added that government-owned refineries are less vulnerable to global supply disruptions compared to privately owned refineries dependent on imported crude.
- The PETROAN President warned that continued fuel price increases would worsen inflation, cause job losses, deepen economic hardship, increase transportation costs, and raise prices of goods and services nationwide.
- He emphasised that PMS remains essential for daily mobility, while AGO is vital for manufacturing and industrial operations.
He assured Nigerians that President Bola Ahmed Tinubu reform policies will ultimately bring relief to citizens and stimulate economic growth.
Backstory
PMS price now sells above N1,000, causing motorists to groan across the country.
- The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has said fluctuations in fuel pump prices are a direct result of market dynamics under Nigeria’s deregulated downstream petroleum sector.
- The authority’s spokesperson, George Ene-Ita, said this in an interview with the News Agency of Nigeria (NAN) in Abuja on Sunday while reacting to the recent increase in fuel pump prices linked to the ongoing Middle East crisis.
He explained that the situation reflects how a deregulated petroleum market operates, where fuel prices respond to supply and demand conditions rather than government regulation.
- “Nigeria has been operating a fully deregulated downstream petroleum regime since the inception of the current administration. Therefore, pump price vagaries are purely a result of market dynamics,” he said.
What you should know
The ongoing war has pushed oil prices higher globally. Data from global commodities markets show that Brent crude futures surged by about 20 per cent last week, while West Texas Intermediate (WTI) crude climbed roughly 25 per cent amid fears of supply disruptions.
- The rise in prices is partly linked to attacks on oil infrastructure in the Middle East.
- On Saturday, Israeli forces struck oil storage facilities in Tehran, marking the first reported attack on Iran’s oil infrastructure since the war between the two sides began.
- Iran has also targeted oil facilities in several Middle East and Gulf countries, where US forces sometimes operate from.
The Group of Seven (G7) finance ministers are also set to discuss a joint release of oil from emergency reserves coordinated by the International Energy Agency.
Three G7 countries, including the US, have so far expressed support for the idea, the report said and added that the ministers and the IEA Executive Director Fatih Birol will hold a call to discuss the impact of the Iran war.
