The Major Energy Marketers Association of Nigeria (MEMAN) has reported a slight reduction in the landing cost of Premium Motor Spirit (PMS), commonly known as petrol, signaling some level of stability in the downstream oil sector.
According to reports, the landing cost decreased marginally from ₦971 per litre in November 2024 to ₦970 per litre in December.
This reduction corresponds with a recent dip in crude oil prices, which fell from $74 per barrel the previous week to $73.77 per barrel on Wednesday.
In its daily energy bulletin, as reported by Vanguard, MEMAN attributed the latest figures to an exchange rate of ₦1,533.57/$ and a Brent crude oil price of $73.91 per barrel.
MEMAN highlighted that global petroleum product pricing remains highly volatile due to geopolitical and economic factors, including events in the Middle East, developments in China's market, and the impact of recent U.S. election outcomes. The association stated,
"The foreign exchange rate is also experiencing volatility. As a result, landing costs, which are closely tied to these factors, may fluctuate multiple times within a single day."
Despite these changes in landing costs, the retail price of petrol in Lagos has remained unchanged at ₦1,025 per litre.
Commenting on the situation, Ehimen Joseph, Chairman of MEMAN's Lagos State Chapter, noted,
"Petrol prices are determined by market forces under a deregulated market system. A price drop is possible."
Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), added,
"The price of petrol cannot drop immediately because marketers still hold large inventories. Until these stocks are sold, reductions won't occur. However, over time, as market forces and exchange rate fluctuations take effect, we may see a gradual reduction. It's important to note that price changes in the market typically come with a delay of a month or two, depending on the depletion of existing stock and stability in foreign exchange."
Comments