The Petroleum Products Marketing Company (PPMC) has announced that the ex-depot price of petrol will now be ₦151.56 per litre. The new price was disclosed in a memo released by the body on Wednesday.
The ex-depot price is the price at which petrol is sold to merchants at the depots. It is an indicator of the price that retail stations are likely to set for the product (pump price).
Read more about Finance
The newly announced price constitutes a significant increase in the cost of petrol, which until recently was sold at ₦138.62 at depots.
The price increment suggests that petrol stations will raise their prices in the coming days as well. The exact price at which they will sell is yet to be ascertained.
Starting in May, the Nigerian National Petroleum Corporation– the parent body of the PPMC –had begun reviewing petrol prices on a monthly basis. President of the NNPC, Mele Kyari, had said that the move was part of efforts aimed at deregulating the downstream sector of the petroleum industry.
Initial price reviews had seen the pump price pushed downwards. This was due to the lower cost of crude oil at the international markets, triggered by the global lockdown that dried up demand for the commodity across the world.
Sign up to the Connect Nigeria daily newsletter
Those prices have since rebound because of a return of economic activity and a resultant rise in demand for petrol in many parts of the world. That rise has, in turn, forced the cost of petrol upward closer to home.
In July, the Petroleum Products Pricing Regulatory Agency (PPPMC) fixed a retail price range of between ₦140.80 and ₦143.80 for the product. At the time, the price of the product at the depots was set at between ₦109.78 and ₦111.78.
But in August, the ex-depot price climbed to ₦138.62, prompting concerns that the price at the retail stations could soar well beyond its current cost at the filling stations.
While it’s not clear what the pump price is likely to be, some local media outlets report that it may settle at about ₦160 per litre.
Featured Image Source: Nairametrics
Got a suggestion? Contact us: editor at connectnigeria dot com