The Nigerian government has made a significant move in the oil and gas sector, announcing that petroleum marketers can now purchase Premium Motor Spirit (PMS), also known as petrol, directly from the Dangote Refinery.
This decision effectively ends the Nigerian National Petroleum Company Limited’s (NNPCL) monopoly as the sole off-taker of Dangote petrol.
According to the Minister of Finance, Wale Edun, who is also the Chairman of the Naira-Crude Sale Implementation Committee, this development is aimed at enhancing efficiency in product availability and stabilizing market conditions for the benefit of all Nigerians ¹. Edun revealed that the decision was reached after a meeting of the Implementation Committee on the Sales of Crude Oil and Refined Products in Naira.
*Benefits of the New Policy*
– _Increased Competition_: By allowing marketers to purchase petrol directly from the Dangote Refinery, the government hopes to foster competition in the downstream sector.
– _Improved Product Availability_: The move is expected to enhance efficiency in product availability and stabilize market conditions.
– _Better Pricing_: With more players in the market, prices are likely to become more competitive.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) has welcomed the development, stating that buying directly from the refinery is the right thing to do ². IPMAN’s Secretary, Terlumun James, noted that the association is focused on ensuring that its members have products to sell to the public.
However, the decision comes on the heels of NNPCL’s increase in fuel pump price to N1030 per liter in Abuja, which has been rejected by IPMAN and the Nigeria Labour Congress. The government’s commitment to ramping up local production of PMS is seen as a step in the right direction, but its impact on prices remains to be seen.
As the government continues to engage with stakeholders to ensure a seamless transition process, Nigerians await the outcomes of this new policy.
