NNPC Limited (NNPCL) is being unfair to Nigerians. Despite the fact that Nigeria is now refining fuel locally from its own crude oil, NNPCL continues to calculate fuel prices based on outdated metrics such as landing costs. This practice raises concerns, as there are no longer any costs associated with fuel importation, shipping, or landing fees. With locally sourced crude being refined domestically, there is no justification for maintaining the high prices.
Based on current international crude oil prices, ranging from $75 to $82 per barrel, the price of fuel should not exceed N200 per litre in Nigeria. The excuse of a “landing cost” of N1,030 per litre is both perplexing and unjustifiable. Landing cost from where? There are no longer import duties, shipping charges, or other import-related expenses. So, why are Nigerians still being burdened with such exorbitant fuel prices?
In Libya, a country with locally refined fuel, the price of petrol is about N52 per litre (based on local currency exchange rates) as at 16 September 2024. Libya also boasts one of Africa’s highest minimum wages, at $208.33, making the contrast even more stark.
Here in Nigeria, the cost of a barrel of crude oil should yield significant returns from its various derivatives, ensuring refineries, including the Dangote Refinery, can make substantial profits. From a single barrel of Bonny Light crude oil, a typical refinery can extract a variety of products, including:
- Gasoline/Petrol: 70-80 litres
- Kerosene: 20-25 litres
- Diesel: 30-40 litres
- Jet fuel: 20-25 litres
- Bitumen: 5-10 litres
- Other products (e.g., LPG, fuel oil): 10-20 litres
Given this breakdown, it’s clear that the current fuel prices are far from justifiable. Nigerians are being unfairly charged, and the government or authorities overseeing this sector either lack competence or empathy for the hardships faced by the masses. Fuel prices have a direct impact on inflation, making this issue all the more critical.
It’s high time the authorities reconsidered these inflated costs and allowed Nigerians to breathe, economically and otherwise.
God save Nigerians!
