•Say consumers could face deeper hardship
By Adewale Sanyaolu
Oil marketers under the aegis of the Petroleum Retail Outlets Owners Association of Nigeria (PETROAN) have warned against rising low petrol prices among operators, saying the trend doesn’t reflect current market and economic realities.
National President of PETROAN, Mr. Billis Gillis Harry, in an interview with Daily Sun, yesterday, warned further that the trend is a strong indication of growing bad market behaviour that should be checked by the relevant regulatory agencies.
The PETROAN President said various marketers, in a bid to remain in business, are dropping prices below the market average.
He argued that the market behaviour was as a result of the consistent drop in petrol price by Dangote Refinery, which is already threatening the existence of other market operators in the downstream sector.
The Dangote Petroleum Refinery in the last two months has dropped petrol prices more than 10 times.
“Those prices you see that are around N815 or N820 per litre don’t reflect market or economic realities. They cannot stand the test of time.
The big player in the industry is to be blamed for this unhealthy rivalry/competition in the market.
But let it be known that everyone is bleeding. The industry shouldn’t be a monopoly. Let it be known that if the big player is ready to lose money, others are equally ready as well,” he said.
According to a market survey on petroleumprice.ng, a portal that tracks petroleum products prices in real time, Aiteo, Sahara, Menj, Rainoil, First Fortune, Parker, Zamson, TSL and NIPCO put their prices at N819, N825, N815, N825, N839, and N825 per litre respectively.
On the other hand, the retail prices of some key Dangote partners, which included Ardova, MRS, Heyden, and others, had risen above the market average, hitting N860 per litre.
If not urgently addressed, he said Nigerians and members of the consuming public would be the ultimate losers through all forms of anti-market behaviours. Some of those behaviours include under-dispensing, off-spec products, and in some extreme cases, dumping of substandard/toxic fuel.
He advised that market prices should be subjected to tests by the Federal Competition and Consumer Protection Council (FCCPC) and the Nigerian Midstream Downstream Petroleum Regulatory Authority (NMDPRA) to check market abuse.
“In as much as we want Dangote business to be successful, we also want to be successful. There should be a meeting point where everything we do should be able to bring succour to the Nigerian people.
No doubt, Dangote has the idea to make the industry work, but some of those ideas need deeper thinking for it to thrive,” he said.
Recall that PETROAN had two weeks ago accused Dangote Petroleum Refinery of plans to exploit Nigerians and monopolise the downstream sector over its recent forward integration adoption.
It warned further that the plan could pose a significant job loss threat to Nigeria.
The association argued that Dangote Refinery, with a production capacity of 650,000 barrels per day (bpd), should be competing with global refineries, not operating as a distributor in the downstream sector.
“This massive refinery, one of the largest in sub-Saharan Africa, is expected to satisfy domestic fuel demand and export surplus products.
It equally raised concerns about Dangote’s intention to dominate the downstream sector, citing plans that the company may leverage its market power to fix prices, limit competition, and exploit consumers, much like it has done in other sectors.
The marketers explained that Dangote’s tactics may include a pricing penetration strategy, where they reduce prices to capture market share, with the ultimate goal of forcing other filling station operators to quit the market.
This, it said, could lead to a massive shutdown of filling stations across Nigeria, resulting in widespread job losses.
It added that the introduction of 4,000 brand-new Compressed Natural Gas (CNG)-powered tankers by Dangote Refinery poses a significant threat to the livelihoods of thousands of truck drivers and owners.
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