Fuel price: Ex-MOMAN boss cautions against speculation
By Yusuf Yunus
Mr Tunji Oyebanji, former Chairman, Major Oil Marketers Association of Nigeria (MOMAN), has cautioned Nigerians, especially marketers against speculations over petreleum pump price.
Oyetunji said this in an interview with the Business Intelligence (TBI Africa) in Lagos.
He was reacting to a recent statement Mr Mike Osatuyi, National Controller Operations, Independent Petroleum Marketers Association of Nigeria (IPMAN), that the pump price would go increase to N700 per litre.
Osatuyi on June 28 projected that prices could rise to above N700 per liter in the north once independent marketers start importing the products from July.
Oyebanji said that no marketer could speculate the fuel pump price until importation of the product starts.
Oyebanji, also the Managing Director, 11 Plc, said: “It depends on the exchange rate. If those factors are changing, prices of those products will also change.
“As you know, at a time, diesel went up significantly at above N800 per litre, but now it has come down to within N600 to N620 per litre.
“So, once you are in a deregulated environment, that is how it is, especially when you are importing the product.
“I can not project price of petrol for now until we import the product.”
According to Oyebanji, at some point, the projection is speculation.
“Not until you order a cargo, know the exchange rates, before you can predict the price.
”Those projecting the price are just saying this on sensational basis to get marketers excited.
”I do not think anybody needs to do that.
“If there’s a certainty; if you are observing the exchange rates, you will see that it is getting worse. if the price at the international market is also going up, then, you see how those things are being affected and that is how the price comes in.
“We can not mitigate prices, people will have to adjust their spending accordingly and priotise their choice,” he added.
Oyebanji, however, added that the price could also be reduced, depending on the exchange rate.
“The bottom line is that there will be an adjustment in price. Yes, it may go up and can also drop, depending on the exchange rate.
“But the good thing is that products will be everywhere. if people see that yours is more expensive than those of the filling stations around them, they will not patronise you. Then, you will be forced to bring down prices so that customers can come and buy.
“There will be healthy competition and which is good for the market,” he said.
Meanwhile, Osatuyi told TBI Africa that fuel being sold by marketers such as DAPPMAN, IPMAN and MOMAN are old stock
“Nobody has imported new products from the new foreign exchange regime and on the new deregulation.
“Marketers are just planning to import, so, everybody is in a transition pricing to the new regime.
Osatuyi further said that “Because we are operating new regime of foreign exchange, no more SWAP, both IPMAN, DAPPMAN and MOMAN will import at N770 per litre or whichever price that is reigning on the day you bought your product.
“Crude price is 70 dollar per barrel, we are going to apply both, based on the pump price.
” Petro landing in Lagos might be N600 per liter, to Abuja, Ondo and Edo is going to be around N640, while to Maiduguri and Sokoto you can not get it less than N700 per litre and the difference is the transportation,” he added.
“But if at the point of booking the crude price comes down, the price will come down and if it goes up to 80 dollar to a barrel, against 70 dollar, it will also increased.
“Any price fix now, will be changing every day, week and month, so, that is the basis of my analysis.
“However, the benefit to Nigerians is that government will make more money on forex because it was N465 now N770,so,they will make more money on foreign exchange.
“And again, it is going to be in trillion and also make money on subsidy, which is also in billion.
“The essence is depending on the volume of importation we are going to really make money for government.
“Forex and subsidy will boost government revenue, however, the money they save is going to be for the benefit of Nigerians,” Osatuyi emphasised.
