Mele Kyari, group chief executive officer (GCEO) of the Nigerian National Petroleum Company (NNPC) Limited, says the new petrol pump price is reflective of the current market cost of the commodity, and as such, “prices in the market can go down at any time”.
Kyari spoke in an interview with Arise TV on Thursday.
In his inaugural speech on May 29, President Bola Tinubu declared that the petrol subsidy payments had stopped.
Although the president’s media team later clarified that the implementation of the policy would commence this month, post-subsidy realities kicked in immediately — sending the price of the product to high levels.
The NNPC, which backed the president’s pronouncement, announced the adjustment of the pump price across its retail outlets nationwide.
The national oil firm said the adjusted pump price conforms with market realities.
Kyari, during the interview, said the removal of the petrol subsidy will promote competition and regulate consumption, adding that the new pump price will adjust itself.
“The prices we are seeing today at our station are the current market price of the commodity. So, what this means is that prices in the market can go down at any time and of course, the market will adjust itself,” he said.
“The beauty of this is that there’ll be new entrants because oil marketing companies know the result of their reluctance to come into the market all along is the very fact that there’s a subsidy regime that is in place, and that subsidy regime doesn’t have the guarantee of repayment back to those who provide the product at subsidised prices.
“Now that the market regulates, oil marketing companies can import products, whether it is produced locally, they come by and take it into the market and sell it at a commercial price.
“Therefore, you will see competition, even with NNPC, and by the way, by law NNPC cannot do more than 30 percent of the market going forward. As soon as the market stabilises, all marketing companies can come in, it means that even the requirement of energy security in the law indicates that you have to be able to have at least 30 percent of the stock in the country.
“In a week or two, there will be changes downward, as competition will come in. As soon as competition comes in, people become more efficient in their depots, in managing their trucks. There will be no monopoly. NNPC will not continue the supply of this product alone and therefore, we see the comfort for the consumer.”