Some oil and gas experts have said that the coming on stream of both the Port Harcourt and Dangote Refineries may lead to marginal reduction in the cost of Petroleum products and not a significant price crash.
Speaking to the News Agency of Nigeria, NAN, on Sunday in Abuja, they said some ancillary cist such as freight and port charges among others would have been eliminated to achieve the marginal reduction.
The Federal Government had on December 21, announced the mechanical completion and flare start-up at the Port Harcourt Refinery Company Ltd and the subsequent streaming of its phase two in 2024.
This according to the Minister of State for Petroleum, Senator Heineken Lokpobiri will herald the production of petroleum products after the Yuletide break.
Reacting to the development, an Associate Professor of Energy and Natural Resources at the University of Abuja, Olarewanju Aladeutan said there should be some marginal reduction in tje price of petrol as some ancillary cost should gave been eliminated.
However, he explained that the price of Petroleum products may not come down significantly as to describe it as crashing.
He said, ” the price may not come down significantly considering the fact that crude oil and condensate supply for the domestic market under the Petroleum Industry Act is going to be based on a willing buyer and a willing supplier basis. And the fact that that the supply of crude oil is going to be commercially negotiated having regard to the prevailing international price for similar grade of crude.
“Hence international price which is denominated in dollars will still be the determinant of the cost of crude oil that will still be refined. So, I don’t see how the price of petroleum products will crash.”
Also speaking, Mr Yishau Aliu , an economist said the completion of the mechanical units is a significant mileage was an indication that part of the refined petrol deficit would be addressed.
” We are expecting the NNPC Ltd retail station to reduce their pump price due to absence of landing cost in the short term,” he said.
Another expect who wished to keep his identity said it was obvious done people in the oil and gas sector were engaged in acts of sabotage.
” They claimed that the 60,000 capacity Port Harcourt Refinery is back on steam, while the 150,000 capacity will soon work.We are waiting to see them work including the Warri and Kaduna refineries. When they are out to use, let’s see why prices will not crash.”
Since the removal of petrol subsidy in May, 2023, petrol prices have been selling for between N600 and N700 with the NNPC Ltd retail stations selling for N613. The attendant impact has been increased cost of goods and services, high inflation and untold hardship and suffering of Nigerians.
