In response to the Minister of Petroleum, Oil, Heineken Lokpobiri on marketers to reduce the pump price of Petro, fuel traders under the aegis of the Independent Petroleum Marketers Association of Nigeria, IPMAN has rebuffed him.
Reacting to the remark made by the minister, IPMAN National Secretary, Chinedu Ukadike, said the Minister cannot tell marketers what price to sell their products, under a deregulated market system.
“Marketers will shut down if they try somehow to enforce price control,” Ukadike threatened.
According to him, the marketers will sell based on what they buy, adding that the federal government should look elsewhere on who to blame for the high cost of Petroleum products in the country.
The Minister had on Sunday, during a stakeholders meeting in Abuja, the nation’s capital rebuked the marketers for not reducing the pump price of petrol despite the falling crude oil prices in the international marketers.
Not a few Nigerians have also criticized the marketers for not reflecting the reduced cost of crude oil at the pump, saying the marketers were quick to raise the price when crude oil price went up in February due to the War between US/ Isreal and Iran, but failed to reduce the price now that crude oil price has fallen to as low as $75 per barrel, from over $120 per barrel at the peak of the hostilities.
He directed agency of government responsible for consumer protection, to swing into action to ensure that Nigerians are not ripped up by the marketers.
But in a swift reaction, the marketers said they will sell what they buy, saying they have been incurring loses due to the instability caused by the war in the Middle East.
IPMAN scribe said the government should focus on how to revamp the nation’s dilapidated refineries, saying that will bring about competition and force down the price of petrol in the country.
“Marketers will shut down if they try somehow to enforce price control. We are going to shut down our stations nationwide. You can’t be regulating a deregulated market. You can’t tell me how much to sell my product without trying to know how much I bought it,” he said.
“We, the independent marketers, are losing money. We bought petrol at a particular rate a few days ago; on our way to our filling stations, there was a reduction. We have been struggling with the price. We have been struggling against financial losses. We are also struggling against stagnation due to low patronage of our products. Because those marketers who are purchasing now are purchasing at a lower price, and they are selling cheaper.”
He explained that petrol price is determined by market forces, noting that the marketers have also incurred loses due to recent fluctuations in the sector, as a result of the war, adding that many marketers are trading with loans from banks.
“If you don’t bring down your price, you cannot see buyers. This is the beauty of deregulation. If you cannot compete, you will not survive in the market. And because most of us are trading on bank loans, the bank does not know when the price goes up or goes down. Their interest rate is fixed; their return on investment is fixed. So, you must pay them. This is the situation we find ourselves in,” he said.
Adding, “By the time more products come in, you will see that the prices will go down. What we, independent marketers, are asking for is not about regulation or trying to bring price control or trying to force marketers to sell below or trying to force Dangote to sell below its production cost. What we are asking is to open up the various channels, boost importation, and let local refineries start refining. This will push the competition to the peak. With this, prices will drastically go down.
“The primary cause of this is that there is no competition. If there should be competition, the refineries will be working. That is where the minister should put his energy to ensure that our local refineries or whatever partnership we have with the Chinese will work. It is not about going to filling stations to check who is selling at higher prices. Do you know how much I bought the fuel for? Can you have a regulated market in a deregulated economy? You can’t be blowing hot and cold at the same time. The PIA must be followed to the letter. If they try to enforce price control, we will shut down”.
Similarly, President Donald Trump of the United States had threatened that his administration will come down hard on fuel markerketers in the country.
The US Leader warned that his government will take action against them if they failed to reduce the price now that crude oil prices have fallen.
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