OMONI OKONKWO FROM NAIRAMETRICS
Presidential candidate of the Zenith Labour Party (ZLP), Chief Dan Nwuanyanwu, told Channels Television during a recent interview, that he will ensure Nigerians buy fuel at N100 per litre if he wins next month’s election.
The presidential candidate also claimed that criminals involved in oil bunkering will not allow the country’s refineries to work, as they will rather prefer that fuel is sold at N1,000 per litre. He said:
- “I will sell fuel for N100 in this country. I have calculated it. All these refineries will be put to use within three, or four months. At the same time, simultaneously, we are going to install modern refineries in each geopolitical zone.”
Meanwhile, some factors could hamper Nwuanyanwu’s decision to reduce the pump price to N100 per litre. These factors include:
Landing costs: As the candidate said, his government will set up modern refineries in each geopolitical zone in the country. Doing this will take some time and no one knows when. Before that, the country will keep importing refined petroleum products. Landing costs which are associated with shipping expenses will factor into the cost of fuel in the country.
The proposed output of the Kaduna, Warri, and Port Harcourt refineries, the Dangote refinery as well as current modular refineries are not enough to meet domestic demand for fuel, so there will still be importation when all refineries are active.
Also, as long as the Russia-Ukraine war is still on, supply chains will be affected and this could factor into shipping costs, which will continue to affect fuel prices. Shipping expenses will also impact the delivery of equipment meant for setting up modern refineries. To put this into perspective, in September 2022, Mele Kyari, the Group Chief Executive Officer (GCEO) of the Nigerian National Petroleum Company said the landing cost of PMS stood at N327.68 per litre.
Varying fuel costs: Chief Nwuanyanwu will need to consider the challenge of varying costs of fuel in Nigeria. Currently, the country does not have a uniform price across states. The official price for fuel in Nigeria today is N165 per litre, however, Nigerians are buying the commodity at higher prices. Nigerian National Petroleum Company filling stations are even selling at N190 per litre in Abuja, the capital city.
- According to December 2022 data from the National Bureau of Statistics (NBS), fuel prices are not the same in all the states of the federation. The data shows that in December 2022, states in North Central are paying an average of N209.44 per litre for fuel, with the highest being N216 per litre.
- States in the North East paid an average of N209.64 per litre, with the highest being N218.89 per litre.
- States in the North West paid an average of N205.68 per litre, with the highest being N213.93 per litre.
- States in the South East paid an average of N204.44 per litre, with the highest being N215.91 per litre.
- States in the South-South paid an average of N200.02 per litre, with the highest being N204.67 per litre.
- States in the South West paid an average of N207.15 per litre, with the highest being N210.42 per litre.
However, a Nairametrics survey in December 2022 showed that in the South-East region, fuel prices were higher than the average shown in the NBS data. Filling stations in Imo state were selling at N400 per litre, also in Anambra, motorists bought fuel at N285 per litre. In Enugu, fuel was sold for N265 per litre and in Umuahia, fuel was sold for N305 per litre.
