Following the recent floating of Naira against the United States Dollar by the federal government. Oil Marketers operating say there is a high possibility for the cost of petrol to rise in July.
According to reports Central Bank of Nigeria (CBN) recently unified the country’s exchange rates into the Investors and Exporters window, allowing market forces to determine the exchange rate.
However, the National President, Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Okonkwo, Thursday noted that petrol prices would rise in response to forex rates.
His words: “When there is deregulation and no subsidy, the price of petrol would either go up or come down. If you want to profiteer, those who bring in and sell at cheaper rates would put you out of business.
“So the market fundamentals will determine the pricing and capping. Therefore the floating of the Naira at this time that Nigeria is beginning to make savings is not going to be a fixed thing.
“The exchange rate will also move up or down depending on how we manage our crude oil, which is our foreign exchange earner. By the time we begin to meet our OPEC quota and other areas of generating foreign exchange, the Naira will begin to firm up.
“And this will result in cheaper fuel. So we should not be thinking that the cost of fuel will continue to rise. The floating of the Naira is good because at the previous level, you only access the dollar at the official rate based on who you know.”
Commenting on petrol imports by independent marketers, Okonkwo stated that the oil dealers were holding meetings about this.
According to him, We are holding meetings with a lot of people who are interested in commencing PMS imports. We are not resting on our oars about this.
On his part, the President, Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Billy Gillis-Harry, said the cost of petrol will respond to the exchange rate, as the product would rise in price going by the current forex rate.
He added: “So long as the exchange rate is high, the cost of petrol will be high. But these are early days and the expectation with the President Bola Tinubu-led government is that the exchange rate will be getting lower. So we will get there.”
On plans by his group to start importing petrol, he said, “PETROAN is already working on the import license approval for petrol, because it has to be approved before you can import. We are doing this, while we still negotiate with the government on the process of getting the refineries to work.”