The Nigerian National Petroleum Corporation (NNPC) has finally admitte on Monday that the sale of petrol at the current market price of N145 per litre was unsustainable due to the prevailing exchange
rate. NNPC also admitted that despite the preferential exchange rate made available to oil marketers to import petrol, many were reluctant to do so because they would be selling at a loss at the prevalent pump price, implying that NNPC that continues to import it was subsidising petrol.This came as the House of Representatives pledged to review the laws on licensing, regulation and incentives on petroleum refineries in the country. Speaking monday in Lagos at the 2016 Oil Trading and Logistics (OTL) Conference, the Group General Manager, Crude Oil Marketing Division at the NNPC, Mr. Mele Kyari, said there was no way petrol would continue to be sold at the current pump price.
Kyari was however quick to add that the present administration would not announce another increase in the petrol pump price, because Nigerians would not accept it.According to him, legislation by the National Assembly would be required for petrol to be sold above N145 per litre. He said some suppliers had already stopped importation because of the current pricing regime. “We have a very difficult business environment. It is impossible today to import products at the current market price – at the curren foreign exchange rate. There is no way today you can take the product to retail and sell at N145. It is not possible today.“If that is true and I believe that it is true because we all go to the market, why can’t we sell above N145? That is where legislation should come in,” Kyari said.
“I also know today that it is impossible for this government to announce tomorrow that petrol is about N150. This government cannot do it. That is the truth. The people will not take that number. That is why suppliers are not importing,” he added.
Kyari was however quick to add that the present administration would not announce another increase in the petrol pump price, because Nigerians would not accept it.According to him, legislation by the National Assembly would be required for petrol to be sold above N145 per litre. He said some suppliers had already stopped importation because of the current pricing regime. “We have a very difficult business environment. It is impossible today to import products at the current market price – at the curren foreign exchange rate. There is no way today you can take the product to retail and sell at N145. It is not possible today.“If that is true and I believe that it is true because we all go to the market, why can’t we sell above N145? That is where legislation should come in,” Kyari said.
“I also know today that it is impossible for this government to announce tomorrow that petrol is about N150. This government cannot do it. That is the truth. The people will not take that number. That is why suppliers are not importing,” he added.
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