Filling Stations Ready to Adjust Pumps Again as Marketers Give New Cost of Petrol
- The new landing cost of petrol is now estimated to have risen above N1,000 per litre as a result of naira depreciation and high petrol prices
- Nigerian currency at the official and unofficial market exchanges continues to struggle against the US dollar
- This means the Nigerian government will have to work harder to keep fuel pump prices at the current rate of N620 per litre
The cost of importing one litre of fuel by marketers from refineries abroad has increased to N1,026.71 per litre.
This is an increase from the N545.83 per litre NNPC paid to bring the same product in the corresponding period in 2023.
Source: Getty Images
According to the Vanguard report, the landing cost excludes other additional expenses, such as port-related charges, transportation logistics, and marketers’ margins. When combined, these costs would bring the delivery price at filling stations to nearly N1,052.39 per litre, based on an exchange rate of N1,510 to a dollar, resulting in a differential of N458.71 per litre.
This means that the federal government is paying heavily to keep fuel prices at N620-N650 per litre despite claims to have scrapped subsidies on petrol.
Fuel prices in Nigeria
There are expectations that petrol landing costs will increase further in June amid the continuous fall of the naira and the price of crude oil in the international market.
Vanguard noted that marketers currently pay N1,052.39 per litre as total direct cost.
A breakdown of the cost is as follows:
- Product cost per litre at N1,026.71
- freight (Lome-Lagos) at N10.37
- Port charges at N7.37
- NMDPRA levy of N4.47
- Storage cost at N2.58
- Marine insurance cost at N0.47
- Fendering cost at 36 and others at N0.06
- Finance cost amounting to N28.04.
It also noted that it now costs over $25 million to import 28,000 metric tons of petrol.
Marketers mentioned in the report said importing at the current pump price would be unprofitable, while the government has not guaranteed a free float of pump prices.
Unless the NNPC continues to find a way to reduce depot prices (how much marketers buy), petrol prices could change at filling stations.
Dangote adjusts diesel price
Earlier, Legit.ng reported that diesel prices at the Dangote Refinery skyrocketed to N1,100 per litre amid the naira's continued fall against the dollar.
Oil marketers reported that the refinery increased the price about two weeks ago, leading to them buying it at about N1,200 per litre.
Also, petrol prices have increased in many private depots to about N710 per litre, which has led to an increase in pump price to N750 per litre.
Proofreading by Nkem Ikeke, journalist and copy editor at Legit.ng.
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Source: Legit.ng
