NNPC blames fuel price hike on shortage of foreign exchange

The Nigerian National Petroleum Company Limited has attributed the price fluctuations of premium petrol, commonly known as gasoline, to poor foreign exchange liquidity.

This was disclosed by the Executive Vice President of Downstream at NNPC, Adedapo Segun, during his appearance on TVC News’ Journalists’ Hangout on Thursday.

Segun explained that the deregulation of the petroleum sector, as per the Petroleum Industry Act (PIA), 2021, has allowed PMS prices to be determined by unfettered free market forces.

According to him, the exchange rate played a significant role in determining the cost of gasoline, a situation further exacerbated by limited access to foreign currency exchange.

“The market has been deregulated, which means that petrol prices are now determined by market forces rather than by the government or NNPC Ltd. Furthermore, the exchange rate plays a significant role in influencing these prices,” Segun said.

Regarding the ongoing fuel shortage across the country, Segun assured the people that the situation will improve within a few days.

He noted that more gas stations will soon recalibrate their pumps and resume selling PMS, which will alleviate the current shortage.

Segun also gave an update on the Dangote Refinery, saying that the NNPC expected the deadline for the start of the removal of PMS from the refinery to be September 15.

According to him, this development should strengthen the country’s fuel supply and reduce dependence on foreign imports.

“No sane individual would be comfortable with the current fuel shortage,” Segun said, adding that NNPC Ltd. is working closely with vendors to ensure that petrol stations open early and close late to meet the demands of Nigerians.

NNPC Corporate Communications Officer, Olufemi Soneye, further reassured the public that NNPC is actively working with relevant authorities to prevent diversion of products and ensure timely deliveries to all stations across the country.

“The shortage is expected to ease in the coming days as more stations recalibrate and begin operations,” Soneye added, urging Nigerians to remain patient as the supply chain stabilizes.

Nigerians on Tuesday had to deal with a sudden increase in fuel prices, with the pump price rising from about N600 to N855 per litre.

Sources indicated that a directive had been issued, ordering retail outlets to increase petrol prices. The directive confirmed that the NNPC Retail Management had approved the petrol price increase.

The sharp increase comes just two days after the company disclosed problems importing fuel, citing $8 billion in debt as a major obstacle.

The price increase has sparked a public outcry, with stakeholders condemning the increase and calling for an immediate reversal.