Experts predict petrol prices could drop below N600 per litre once the Dangote Refinery begins full operations. Discover the conditions needed for this.
The proposal from the Crude Oil Refiners Association of Nigeria (CORAN) is for the Nigerian government to fix the exchange rate at N1,000 per dollar in order to lower the cost of refined gasoline at Dangote Refinery to less than N600 per liter.
In response to the recent spike in gas prices, which are currently ranging from N950 to N1,100 per liter across Nigeria, CORAN spokeswoman Eche Idoko issued this recommendation in a statement.
Intervention is being requested in response to the Nigerian National Petroleum Company Limited’s (NNPC) announcement last week of a further increase in gasoline prices, which was ascribed to Dangote Petroleum’s rising.
According to the NNPC, Dangote’s fuel’s N898 per litre price rise was the cause of the surge.
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But Dangote Refinery said that the primary factor influencing the price of its gasoline was the increase in crude oil prices on the world market.
In response, Idoko called on the government to intervene and stabilize gas prices by modifying the foreign currency (FX) rate.
For example, let’s imagine you are exchanging N1,000 for one dollar in this dollar sale for locally refined petroleum products. And in line with that, the price will significantly decrease,” Idoko said.
He emphasized the necessity for government involvement by explaining that the current prices are a reflection of both the impact of the weakening naira and global crude oil prices.
He continued, “But you will see an improvement if the government intervenes by way of naira sales and pegging the dollar exchange rate for crude transactions at a reasonably low rate.”
“This is not the same as providing funding as a subsidy. Idoko said, “You are merely putting procedures in place to guarantee the product is inexpensive.
