Market forces are to blame for the increase in petrol prices, claims Kyari

The head of NNPCL claimed that the increase in the price of fuel at the pump from over N500 to N617 is not due to a shortage but rather to market forces at work.

According to Mele Kyari, Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC) Limited, market forces are to blame for the increase in the price of Premium Motor Spirit (PMS), also known as petrol, at the pump.

After a meeting with Vice President Kashim Shettima at Aso Rock in Abuja on Tuesday afternoon, Kyari gave a speech.

According to him, as the oil industry is deregulated, market forces will occasionally drive up gas prices and occasionally drive them down.

The head of NNPCL assured Nigerians that the country has a “robust supply” of the necessary good by claiming that the increase in the price per litre of petrol from over N500 to N617 is not a result of a shortage.

Kyari claimed that there is enough petrol in Nigeria for more than 32 days.

According to him, the NNPCL’s marketing division “adjusts prices depending on market realities” and is in charge of doing so.

“This is really what is happening,” he asserted. “It ensures that the market regulates itself so that prices will rise and, occasionally, fall as well.”

The Tinubu administration’s unification of foreign exchange rates and rising inflation rates, which the National Bureau of Statistics reported reached 22.79% in June from the 22.41% recorded in May 2023, coincide with the unprecedented fuel costs.

The research also revealed a sharp increase in food inflation, which rose from 20.60% in June 2022 to 25.25% on an annual basis.

The NMDPRA has reported that oil marketers have started importing petrol in the meanwhile.

The Tinubu administration added that it intended to allocate N500 billion as a palliative to lessen the impact of soaring fuel costs and food inflation. The government intended to offer N8,000 to 12 million households within six months, but the Organised Labour and rights campaigners have opposed this idea.