“We don’t fix prices for Dangote refinery,” NNPC replies MURIC
Sopuruchi Onwuka
The Nigerian National Petroleum Company (NNPC) Limited has declared that it currently as commercial player in a domestic fuel market that is currently undergoing commercial deregulation and is not in position determine prices for private refiners in the country.
The national oil company which declared supply distress last week stated that all domestic refiners are free to sell their products to anyone willing to secure deals with them, stressing that it would not be confined to buying from any single source of supply.
Group Chief Communications Officer of NNPC Limited, Olufemi Soneye, challenged domestic refiners in the country to assist crash the prevailing high cost of petrol in the country by offering lower rates.
Soneye who was responding to allegations from the Muslim Rights Concern (MURIC) that NNPC Limited was undermining Dangote Refinery Limited (DRL) explained that the prevailing high pump prices could present an opportunity for DRL to sell its products at more competitive rates.
MURIC had suggested that recent changes in the price of petrol would hinder DRL from offering competitive prices, further alleging that NNPC Ltd had become the sole offtaker of products from the refinery.
In the statement, Soneye emphasized that the pricing of petroleum products, including those from Dangote Refinery, is dictated by global market dynamics, not by any single entity. He added that recent adjustments to PMS prices in Nigeria do not prevent DRL, or any other domestic refinery, from participating in the market or offering lower prices.
“In fact, the higher pump prices could present an opportunity for DRL to sell its products at more competitive rates if it chooses to do so,” he stated.
Soneye also argued that there is no inherent guarantee that domestic refining will lead to lower prices compared to global pricing frameworks.
He made it clear that refineries like DRL have the freedom to sell directly to marketers on a willing buyer, willing seller basis in a fully deregulated market, adding that NNPC Limited is only one of many players in this market and does not dictate or control the prices at which these refineries can sell their products.
Soneye stated that NNPC Limited would only buy products from DRL if it is economically beneficial under prevailing market conditions.
He pointed out that NNPC Limited currently holds a significant financial stake in the Dangote Refinery and would not see any incentive to undermine the success of a business in which it is heavily invested.
The company reiterated that it has no intention or ability to monopolize distribution in an open market environment.
In addressing MURIC’s concerns, Soneye urged the group to ensure that statements are based on verified facts, as misleading claims have the potential to create unnecessary public distrust. He restated the commitment of the NNPC Limited to a free and competitive petroleum market in Nigeria where no single player can control prices or distribution.
