The cost of landing Premium Motor Spirit (PMS), commonly known as petrol, in Nigeria has dropped significantly by 20.34% over the past three months, bringing it down to N971.57 per litre. This decrease reflects the impact of global market adjustments and supply chain improvements.
Despite the decline in landing costs, the retail price of petrol in Nigeria has seen a sharp increase of N443 per litre (a 71.79% rise), from N617 per litre on August 1, 2024, to N1,060 per litre by November 8, 2024. Data from the Major Energies Marketers Association’s daily energy bulletin shows that in August, oil marketers imported petrol at N1,219 per litre, with a Brent crude oil price of $80.72 per barrel and an exchange rate of N1,611 per dollar. At that time, petrol retailed at N617 per litre.
By November, the landing cost dropped to N971.57 per litre, with a Brent crude price of $75.57 per barrel and an exchange rate of N1,665.84 per dollar. Despite this reduction, the pump price surged to N1,060 per litre at Nigerian National Petroleum Company Limited (NNPCL) stations and N1,180 per litre at independent stations.
The bulletin further indicated that the landing cost was N945.63 per litre in September and N903.64 per litre in October 2024. The persistent rise in retail prices, despite lower landing costs, is attributed to factors such as ongoing fuel market deregulation, exchange rate volatility, rising inflation, and broader economic pressures.
Experts believe that the decline in landing costs should ideally lead to a reduction in retail prices.
