The Nigeria Labour Congress (NLC) has expressed strong disapproval over the recent increase in petrol prices, describing it as an act of disregard for the challenges ordinary citizens face. The increase, which saw prices rise from ₦950 to ₦1,050 and ₦1,150 per litre, has triggered widespread public concern. Stakeholders attribute this increase to the global market’s rising cost of crude oil. According to the Federal Government, through the Minister of State for Petroleum Resources (Oil), petrol prices are directly tied to international crude oil costs.
Recently, the global crude oil market has seen an upward price trajectory, influenced by geopolitical tensions, supply disruptions, and sanctions affecting major oil-producing nations. Meanwhile, oil marketers and the Dangote Petroleum Refinery have echoed this sentiment, emphasising that the recent adjustment reflects global market realities rather than arbitrary pricing. The Dangote refinery, in particular, has stated that it absorbed significant Logistics expenses to ensure nationwide uniform pricing. The refinery’s Retail price of ₦970 per litre is reportedly lower than it could have been if global price increases were fully transferred to consumers.
Labour leaders demand stakeholder engagement in policy formulation.
Notably, the union leaders have criticised the government for neglecting to engage with key stakeholders, such as worker representatives, before making decisions with far-reaching implications. They argue that the lack of consultation has compounded economic hardships for Nigerians, who are already struggling with Inflation and a weakening currency. According to them, engaging stakeholders like labour unions, Private Sector representatives, and student bodies in discussions would provide a platform for inclusive decision-making and reduce public resistance.
Also, they have urged the government to adopt a more inclusive decision-making approach, drawing lessons from previous administrations that prioritised dialogue with stakeholders. As a result, they further argue that this would enable Nigerians to understand better and prepare for policy changes, promoting a sense of shared responsibility. Meanwhile, petroleum marketers have defended the recent price changes, explaining that fluctuating crude oil prices and exchange rate instability are the primary drivers. They contend that these factors are outside their control and intrinsic to a fully deregulated petroleum market. Since the deregulation policy was implemented, fuel prices have been subject to market forces.
Dangote Refinery promises transparency and affordability.
However, the downstream sector’s Volatility has made it challenging for marketers to maintain consistent pricing. Many marketers have reported incurring losses due to sudden market shifts. For instance, when crude oil prices or exchange rates fluctuate unexpectedly, the costs of importing or refining petroleum products can change significantly, leaving marketers scrambling to adjust their pricing strategies. In response to public concerns, the Dangote Refinery has committed to enhancing transparency by publishing weekly updates on its ex-depot, ex-vessel, and pump prices.
This aims to provide consumers with real-time information on price determinants, fostering greater accountability in the downstream sector. Additionally, the refinery has emphasised its efforts to cushion the impact of global price fluctuations by absorbing a portion of the cost increases. Despite these measures, the refinery noted that periodic price adjustments are inevitable, given the dynamic nature of the global crude oil market. The refinery’s spokesperson emphasised that while the current price adjustment reflects a modest increase, it is lower than what it could have been if they had passed on the cost of rising crude oil prices to consumers.
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Beyond that, stakeholders have called for the expedited implementation of the Compressed Natural Gas (CNG) initiative, which the government previously touted as a cost-effective alternative to oil. They argue that delays in rolling out the CNG program have undermined its potential to alleviate the burden of high oil prices on Nigerians. Achieving these goals will require robust collaboration between the public and private sectors, as well as a commitment to transparency and accountability in the management of energy resources. Until these structural issues are addressed, Nigerians may continue to face the hardships of rising fuel costs.