Nigeria is heading for another round of fuel price increase, as depot owners raise their loading prices for Premium Motor Spirit (PMS), also known as petrol.
This comes amid a steady climb in global crude oil prices, with Brent crude reaching $79.76 per barrel on Sunday. The resulting hike in depot rates is likely to impact pump prices at filling stations nationwide.
Over the past week, Nigeria’s benchmark crude, Bonny Light, jumped to $80 per barrel from $73. In response, depots such as Swift Depot, Nipco Depot, and Shellplux adjusted their prices to as high as N950 and N960 per litre, marking a sharp increase of 4.74% on average. Other depots followed suit, with price adjustments ranging between 7% and 10%, varying by location and logistics.
These increases are further exacerbated by escalating import costs driven by crude oil price fluctuations.
Oil and gas expert, Olatide Jeremiah, highlighted the implications of these depot price hikes;
“Rising crude prices inevitably translate into higher refined petroleum product costs. This trend could result in additional increases at the pump, particularly for diesel and petrol,” he explained.
Jeremiah also noted that while crude prices directly influence refining costs, the situation is worsened by import challenges, with most Nigerian marketers relying heavily on imported refined products.
Similarly, marketer Bayo Adelaja emphasized the ripple effect on retail prices; “Depot rates have climbed significantly, creating a direct impact on pump prices. Consumers should anticipate more price adjustments in the coming weeks as depots continue to react to international market conditions,” he said.
Despite these depot price increase, retail prices of petrol in Abuja have yet to see a significant change. Filling stations in the Federal Capital Territory currently sell petrol at prices between N935 and N1,100 per litre, reflecting some market stability for now. However, this may be short-lived as downstream marketers align with rising depot costs.
The sustained increase in crude oil prices and the resulting depot price adjustments underscore the challenges of managing energy costs in a nation heavily reliant on imported fuel. With pump prices likely to adjust upwards in the near future, Nigerian consumers are once again bracing for the financial strain of higher fuel costs.
