The Nigerian National Petroleum Company Limited (NNPCL) has stated that the local production of petrol by Dangote Refinery, Port Harcourt Refining Company, and other refineries in Nigeria will not result in a change in the pump price of the commodity.
In an interview, the NNPCL's Group Chief Executive Officer, Mele Kyari, emphasized that the belief that petrol prices would decrease with domestic production was false. Kyari confirmed that the Dangote Refinery, which was inaugurated in May 2023, would begin producing petrol by the end of July or early August.
He also mentioned that the Port Harcourt Refinery would be operational by the end of the year, further boosting local production. However, Kyari stated that despite the increased petrol volume from these refineries, the price would remain unchanged due to production costs and other factors. He also noted that there would be no subsidy once local production started, as the country lacked the resources to continue subsidizing fuel.
Addressing the ongoing fuel queues across the country, Kyari assured that the situation would be resolved within a day or two, with Saturday being the maximum timeline.
He stated that there were ample supplies of Premium Motor Spirit (PMS) in depots, tanks, and fuel stations, totaling over 810 million liters nationwide. Kyari confirmed the authenticity of a PMS pricing document that circulated online and clarified that it was an internal company record, not an official announcement.
Kyari revealed that President Bola Tinubu's administration had plans to repair and optimize one of the four refineries before the end of the year.
He argued that continuing fuel subsidies was no longer justifiable due to the high opportunity cost for the government. Kyari expressed concerns about the NNPC's financial situation, highlighting the lack of funding for subsidies in 2023, which would affect the company's ability to meet its obligations.
He stressed that the removal of subsidies was necessary to prevent defaults and maintain the country's borrowing capacity. Kyari acknowledged that the price increase would cause inflation but stated that market forces would determine the future prices. He emphasized that the current pump price reflected the market price and could fluctuate in response to changing conditions. With the removal of subsidies, Kyari predicted increased competition in the market, which would lead to efficiency improvements and potential price reductions.
The House of Representatives called on the federal government to end subsidies on all petroleum products and recommended the implementation of measures and palliatives to mitigate the impact of subsidy removal on Nigerians.
The House Ad Hoc Committee also made various recommendations regarding the petroleum industry, including stricter regulations, reconciliations of financial matters, and the investigation of defaulting oil companies and government agencies.
The Nigeria Labour Congress dismissed rumors of an imminent nationwide protest against the fuel price hike but stated that they would hold meetings to discuss the issue and inform the public of their next course of action.
In response to the price increase, civil society organizations in Edo State staged protests, causing disruptions to vehicular movement.
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