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Landing cost, tax pushing petrol pump price above N145

More revelations have emerged on why independent marketers are still inching for upward recalibration of petrol pump price.

Since the mid of last month, marketers have been scheming for increase in pump priced or reduction in landing cost so as to remain in business, saying it is no longer feasible for depots to sell petrol at the federal government’s approved price floor of N123.28 to N133.28 per litre.

In their position, the marketers claim that the risen landing cost currently has technically pushed pump price above N145 and the government is not willing to entertain that.

The Petroleum Products Pricing Regulatory Agency (PPPRA) fixed the rates for depots, who sell to filling stations. The scenario indicates that depots operated by independent marketers were now selling between N136 and N141 as at last weekend.

Besides, marketers say they cannot import petrol with the N305 per dollar foreign exchange rate provided by international oil companies.

This according to a marketers means that “If you land it at N145 per litre, you cannot even sell it because our official ex-depot price is N133.28. So, if you land product at N145 and if you have to sell at the ex-depot price, which the DPR is obligated to enforce, you can see that nobody wants to touch the forex provided by the IOCs.

“It is no longer sustainable- it is no longer feasible because we land it at even more than N145 per litre.

“If you are unlucky and you accumulate demurrage, you might land it at N148. That is why no marketer is importing now. We are dependent on product imported by the NNPC, which I said is not sustainable”, he said.

Earlier on Monday, the Chairman of Depot & Petroleum Marketers Association (DPMA), Mr. Dapo Abiodun has given insights on why his members are no longer involved in the importation of petroleum products especially Premium Motor Spirit (PMS), popularly known as petrol.

In an interview Monday in Lagos, he said “two factors were directly responsible for the failure of marketers from importing products.”

“One is the price of crude which is determined by international forces beyond the control of Nigeria and the second was forex scarcity”.

“If I import petrol today with exchange rate of N305, at crude price of about 55 which translates to about $560 per tonne, for the cost of petrol, it means I will be landing my products at about N157 per litre.

“By the time I include other price margins, it means realistically, petrol need to be sold at about N167 per litre in Nigeria. It is only at this price that marketers can begin imports again.

Continuing, Dapo said “in view of this and being sensitive to the peculiarities of the economy, DPMA members realized that raising the pump price was not a workable option, hence in the main time only NNPC can bear all these cost and still sell at N145.

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