…As Marketers embrace local production, dump importation
The VP Crude Oil, Argus Media, James Gooder has highlighted that competition will play a key role in reducing the fuel pump price in Nigeria.
James spoke during a quarterly webinar organised by the Major Energy Marketers Association of Nigeria (MEMAN) for energy editors.
Speaking, James noted that globally crude prices have been falling with Gasoline prices being the lowest.
He further noted that the coming on board of the Port-Harcourt Refinery will boost competition in the country noting that a monopolised market is dangerous for the consumers and the industry.
He added that with the increased capacity for exports of crude products, it will boost the country’s foreign earnings and ultimately impact the price of fuel commodities.
In his own remarks, CEO of MEMAN, Clement Isong, represented by Head of Economic Intelligence Research Regulation, Ogechi Nkwoji, revealed that members of the association have embraced sourcing for Petroleum products locally rather than importing.
The MEMAN CEO highlighted that while MEMAN members have licenses to import PMS introduced by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), but have in recent time relied on local supply from Dangote Refinery due to the competitive market framework already in place.
Nkwoji noted that products lifted from Dangote Refinery were transported via trucks and vessels to marketers’ facilities in Lagos, highlighting the operational flexibility within the supply chain.
Providing a detailed breakdown of volumes lifted during the 10 weeks, Isong stated that MEMAN members loaded 29,468,333 litres in Week 38 (September 16–22, 2024), followed by 20,843,322 litres in Week 39 and 27,236,283 litres in Week 40.
Explaining the factors responsible for petrol pricing , Isong explained that critical cost components include the jetty location, such as ASPM, and a standard product quantity benchmarked at 38,000 metric tonnes.
He said, “The pricing methodology relies on the Argus Gasoline Euro-Bob benchmark for West African deliveries, combined with an average premium.”
“The exchange rate is derived from the Central Bank of Nigeria’s (CBN) weighted average rate within the Nigerian Foreign Exchange Market (NFEM), which significantly impacts the final price,” he said.
He added further that finance charges contribute heavily to the cost structure, pegged at 32 percent per annum over a 30-day cycle.
“Other local charges include those imposed by the Nigerian Ports Authority (NPA) for services such as towage, berthage, and cargo handling, as well as contributions to NIMASA at 2 percent of local freight and regulatory fees from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which add a combined 1 percent levy,” Isong said.