Foreign exchange challenges and prevailing economic uncertainty have been preventing oil marketers from resuming fuel import, the Petroleum Products Pricing Regulatory Agency (PPPRA) has said.
The Executive Secretary of PPPRA, Mr. Saidu Abdulkadir, who disclosed this while addressing journalists in Abuja on Tuesday also said the Petroleum Products Marketing Company (PPMC) had been the one announcing the price of petrol over the last few months, because it was within its rights to do so, as one of the oil marketers and major supplier of the commodity.
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Represented by the General Manager, Administration and Human Resources of PPPRA, Mr. Victor Shidok, Abdulkadir said because of the difficulties in accessing foreign exchange by oil marketers, the PPMC is currently the sole importer of the commodity into the country, and announces the prices at which it sells the commodity to oil marketers.
“You know the role that foreign exchange plays with the sourcing of PMS. When you are not producing and earning foreign exchange as you ought to do, then there would be pressure on the little that you have.
“That is why you see the galloping foreign exchange. We did not expect it would remain like that forever; that is why government is doing all it can and in the near future, we would begin to see an improvement in the value of the naira.
“Secondly, we believe marketers are still studying the market before they come in fully to resume fuel import. There is also skepticism whenever a new policy is being put up. We do not envisage that the exchange rate would remain at the rate at which it currently is,” he said.
But the PPPRA boss also explained that the price of Premium Motor Spirit (PMS) also known as petrol is not directly correlated with crude oil price, adding that a number of other factors are responsible for the price of the commodity.
He reiterated that the price of petrol in the Nigerian market would be determined by market forces.
He said the PPMC, just like other marketers and importers, would now continue to determine the prices at which they would sell to their customers.
The PPPRA, however, would continue to remain relevant irrespective of the deregulation of the downstream petroleum sector, he said.
The agency, he said, would continue to regulate the sector, and stipulate codes of conduct within which marketers must operate by.
He said: “With government’s pronouncement that he sector is deregulated means that prices would strictly be based on the forces of demand and supply.
“You can have a regulator that always serves as a watchdog to see how these forces are being played out; how the interests of all operators and consumers are taken care.
“It is a market that is open, based on bargaining power and based on where you source your product. PPMC is a marketer; it also sells the product and also carries out analysis as to the price it wants to sell the products to its customers. That is the announcement they always make after doing an analysis of their cost and analysing their margins.”
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