Marketers reveals why fuel price must be increased

Private oil marketers have given reasons the pump price of Premium Motor Spirit, PMS, also known as petrol, must be increased.

The marketers are also calling on the government to intervene to enable them access foreign exchange at a special rate for the importation of petrol.

They said selling the product at N145 per litre is no longer feasible with the current exchange rate.

Private marketers said the shortage of foreign exchange and increase in crude prices, have made it unprofitable to import petrol and sell same at N145 per litre.

The National Operations Controller, Independent Petroleum Marketers Association of Nigeria, Mike Osatuyi, told reporters, “The problem is that the importation (of petrol) is being handled almost 100 per cent by the Nigerian National Petroleum Corporation as private importers have backed out because the increase in crude price has made the landing cost enter subsidy.

“When the crude price hit $59 per barrel, we could not sell petrol again at N145 per litre if we were importing on our own.

“It is only the government (NNPC) that is importing and can warehouse the subsidy.”

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He said the Central Bank of Nigeria, CBN, should have intervened by providing foreign exchange at a special rate solely for the PMS importation for both the NNPC and private importers.

He added, “Right now, the landing cost of the PMS is N154.

If you are importing at N305 to the dollar, by the time you add bank charges, it comes to N307 to the dollar.

“If you apply that to the current crude price, the landing cost is N154- N155. By the time you add all the margins, the pump price is about N160- N167.

“Before private importers can resume importation, the exchange rate to a dollar must be N250 and we can sell at the price of N145 per litre.”

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