Crude price drop: FCCPC demands lower petrol prices

The Executive Vice Chairman and Chief Executive Officer of the FCCPC, Mr Tunji Bello

The Federal Competition and Consumer Protection Commission has warned oil refiners and marketers against keeping petrol and diesel prices high despite the recent decline in international crude oil prices, insisting that consumers must benefit from lower production costs.

The commission said it was monitoring developments in the global oil market to ensure that the drop in crude prices translated into reductions in the prices of petroleum products sold at filling stations across the country.

The Executive Vice Chairman and Chief Executive Officer of the FCCPC, Tunji Bello, gave the assurance in a statement issued on Tuesday by the commission’s Director of Corporate Affairs, Ondaje Ijagwu, following public enquiries over the persistent high cost of petrol.

The statement read, “The Federal Competition and Consumer Protection Commission is closely monitoring the continued drop in crude prices in the international market to ensure the gain reflects in what Nigerians pay at the filling stations.”

Latest market reports indicate that Brent crude futures have fallen from a peak of $115 per barrel in September to below $90 this week, raising expectations that the decline could ease pressure on domestic fuel prices.

However, petrol prices remain between N1,405 and N1,420 per litre in Abuja, while motorists in Lagos pay between N1,325 and N1,370 per litre.

The commission recalled that on February 27, a day before the war involving the United States, Israel and Iran began, Brent crude futures closed at $72.48 per barrel. At the time, petrol sold for between N839 and N925 per litre in Lagos and Abuja.

Marketers have repeatedly attributed the increase in fuel prices over the past eight months to volatility in international crude prices following the outbreak of the conflict in the Middle East and the subsequent blockade of the Strait of Hormuz, a major global oil shipping route.

But Bello said a sustained fall in crude prices should compel refiners and marketers to reduce their selling prices, adding that the savings must not be withheld from consumers.

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“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.

The FCCPC chief acknowledged the pressure that high fuel prices had placed on households and businesses, assuring Nigerians that the commission would continue to monitor pricing across the downstream petroleum market.

He said the agency would work with the Nigerian Midstream and Downstream Petroleum Regulatory Authority and other relevant government bodies to track wholesale and retail prices and identify practices that could prevent consumers from benefiting from lower costs.

“We are aware of the difficulties high pump prices have caused Nigerians for some time now. Let me reassure you that the Commission will continue to work with the Nigerian Midstream and Downstream Petroleum Regulatory Authority and other relevant government agencies to track wholesale and retail petrol prices.

“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,” Bello added.

The commission’s intervention comes amid continued public concern over the gap between international crude price movements and domestic fuel costs.

Although Nigeria has expanded domestic refining capacity, including through the Dangote Petroleum Refinery, petrol prices remain exposed to changes in crude oil costs, foreign exchange movements, refining expenses and distribution charges.

The FCCPC said it would monitor the market to ensure that any sustained easing in crude prices was reflected in the prices paid by consumers.