‘Nigerians not benefiting from drop in crude prices’ — FCCPC warns petrol marketers
The Federal Competition and Consumer Protection Commission (FCCPC) has raised concerns over what it described as the failure of petrol marketers to pass on the benefits of declining global crude oil prices to Nigerian consumers, warning operators against exploitative pricing practices.
In a statement issued on Sunday by the Commission’s Director of Corporate Affairs, Ondaje Ijagwu, the FCCPC said its ongoing surveillance of the downstream petroleum sector revealed that reductions in gantry and retail fuel prices have been marginal despite the sharp decline in international crude oil prices.
According to the Commission, marketers and refiners were quick to increase pump prices when crude oil prices surged earlier this year but have been slow to reduce prices now that the global market has eased.
Recall that petrol prices rose to between ₦1,350 and ₦1,500 per litre, while diesel sold for as much as ₦2,000 per litre during heightened tensions in the Gulf between April and May.
Although global crude prices have since fallen, the FCCPC noted that petrol is still selling for an average of about ₦1,200 per litre nationwide, with some local refiners maintaining gantry prices between ₦1,025 and ₦1,075 per litre.
“The Federal Competition and Consumer Protection Commission (FCCPC) has expressed concern over findings from an ongoing surveillance of the downstream petroleum market suggesting undue exploitation of consumers.
“A review of the gantry prices of local refiners, marketers, depot operators and retail outlet operators revealed token reductions in prices that are not commensurate with the steep fall in crude prices in the global market,” the statement read.
The Executive Vice Chairman and Chief Executive Officer of the FCCPC, Tunji Bello, said the Commission was troubled by what appeared to be a one-sided response to fluctuations in crude oil prices.
According to Bello, operators in the downstream sector often move swiftly to increase pump prices whenever crude oil prices rise but are reluctant to reduce prices when the global market trends downward.
“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.
“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,” Bello said.
The FCCPC stressed that while it does not fix fuel prices under Nigeria’s deregulated petroleum market, it will continue to monitor the sector to ensure that consumers are not subjected to unfair or exploitative pricing practices.