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The price of Premium Motor Spirit (petrol) may drop further due to the decline in crude oil prices.
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Oil prices fell about two per cent to a 12-week low, with Brent futures settling at $71.62 a barrel and US West Texas Intermediate crude at $68.37.
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Experts predict that petrol prices could drop below N700 per litre, citing the current market realities and exchange rate stability.
The price of Premium Motor Spirit (petrol) may drop further due to the decline in crude oil prices.
According to reports, oil prices fell about two per cent to a 12-week low, with Brent futures settling at $71.62 a barrel and US West Texas Intermediate crude at $68.37.
The decline in crude oil prices is expected to impact the cost of refined petroleum products in Nigeria.
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Players in the Nigerian downstream oil sector have said that the crude oil price and the exchange rate are the major determiners of the costs of refined petroleum products.
An economist, Paul Alaje, said the price slash of petrol is sustainable and that it should go below N700 per litre considering the current market realities. “It is sustainable to reduce petrol prices to N700 based on today’s reality of the exchange rate.
The challenge we may have is a global crisis that makes the price of crude oil go up. If that happens, we are going to see the difference. But for now, we are seeing relative stability,” Alaje said on Channels Television.
He added, “As of today, our computation reveals that PMS should be around N795 to N820 per litre.”
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The National President of the Petroleum Products Retail Outlet Owners Association of Nigeria, Billy Gillis-Harry, has insisted that the price of petrol will continue to fluctuate based on the foreign exchange rates and international crude oil prices.
However, as lower crude oil prices mean affordable fuel for an average Nigerian, the current price is below the $74 per barrel projected by the Federal Government in the 2025 budget.
FG Moves to Pay N7.7trillion Fuel Subsidy Debts To NNPCL
The Nigerian government has confirmed its plan to settle a fuel subsidy debt of N7.74 trillion owed to the Nigerian National Petroleum Company Limited (NNPCL).
The debt accumulated as an exchange rate differential for the importation of Premium Motor Spirit (PMS) from June 2023 to September 2024.
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