The increases coincide with a sharp rise in international crude oil benchmarks on Monday with Brent hitting $102.8 (+10.91%) and WTI $101.0 (+11.08%) due to the Middle East energy crisis.
Oil marketers have advised Nigerians to brace up for a continued rise in the price of Premium Motor Spirit (PMS) or petrol to about ₦1500 per litre as the US-Israeli and Iran showed no sign of abating.
National President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), President, Dr. Billy Gillis-Harry, advised Nigerians while appearing on Channels The Morning Brief on Tuesday to discuss ‘The Effect Of Global War On Fuel Prices’.
According to him, product availability currently being provided by the Dangote Petroleum Refinery, even though at higher prices, was a better option than scarcity.
“The reality is that if you look at the volatility in the price from what we are seeing today, the Dangote Refinery is the salvation for us, due to the consistent source of product, which is much more important at this time than anything.
“The availability of product is much more important than pricing. The pricing we predicted has risen above ₦1,000 per litre, the other time, to ₦1,175 at the gantry.
“By the time we add the charges, logistics, and others, the price will get higher and higher. So, yes, ₦1500 per litre is not far-fetched. It should not make us panic. It is better for us to have the product available, be able to do our business, and get some level of energy security than not having it”, he said.
His stance followed ongoing tension in the Middle East, which has sent energy prices higher than expected.
Dangote Petroleum on Monday revised its ex-depot prices, increasing the gantry petrol price to ₦1,175 per litre, while Automotive Gas Oil (AGO), commonly known as diesel, was raised to ₦1500 per litre.
The latest revision marks the fourth consecutive price review in less than two weeks amid global market volatility.
Under the revised structure, the ₦1,175 per litre petrol price reflects a significant jump from the previous ₦995 per litre, while diesel has surged sharply from its prior ₦1,430 per litre level, underlining the continued upward trend in domestic fuel pricing.
The increases coincide with a sharp rise in international crude oil benchmarks as of 1:00 pm WAT on Monday: BRENT CRUDE: $102.8 (+10.91%) and WTI CRUDE: $101.0 (+11.08%) due to the Middle East energy crisis.
The development is having a ripple effect across Nigeria’s downstream petroleum market, as depot operators and fuel marketers adjust supply costs in response to the revised prices announced by the country’s largest refining facility.
Oil prices soared 30 per cent Monday on fears about supplies from the Middle East, as the war continued into a second week with no sign of letting up.
Since the beginning of the war, WTI is up more than 75 per cent and Brent more than 60 per cent.
While responding to market volatility, the Managing Director and Chief Executive Officer of Dangote Petroleum, David Bird, at a press conference on Monday, explained that although Nigeria introduced a crude-for-naira arrangement to enable local refineries to purchase crude oil in the local currency, the pricing of the commodity remained tied to international benchmarks.
As a result, he noted that the refinery still buys Nigerian crude at global market prices and does not benefit from discounted supply.
US President Donald Trump said Monday that he will waive some sanctions on oil to boost supply and bring down prices, due to market turmoil over the war.
The US-Israel strikes on Iran, and Tehran’s retaliatory attacks across the Gulf region have upended the world’s energy and transport sectors, virtually halting activity in the strategically vital Strait of Hormuz.
“We’re also waiving certain oil-related sanctions to reduce prices,” Trump told reporters after talks with Russian President Vladimir Putin.
He also mentioned Chinese President Xi Jinping.
“We have sanctions on some countries. We’re going to take those sanctions off till this straightens out,” Trump added.
The oil market responded positively on Tuesday after President Trump’s war de-escalation statement.
“I think the war is very complete, pretty much. They have no navy, no communications, they’ve got no air force,” Trump told CBS News by phone.
“If you look, they have nothing left. There’s nothing left in a military sense,” he added.
Trump told the US broadcaster that the United States was “very far” ahead of his initially stated wartime frame of four or five weeks.
He later told a news conference in Florida that “it’s going to be ended soon, and if it starts up again they’ll be hit even harder”.
When asked if he thought the war could end in days or weeks, he replied: “I think soon. Very soon.”
The US leader also threatened an attack of “incalculable” size if Tehran blocks oil supplies coming through the Strait of Hormuz, through which a fifth of global supplies pass.
His remarks come just days after he issued a statement saying Iran’s “unconditional surrender” was the only acceptable outcome for ending the war, which sent shivers through markets fearing an elongated war.
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