The Nigerian Midstream and Downstream Petroleum Regulatory (NMDPRA) has increased tariffs by nearly 600% between 2020 and 2023, according to the Independent Petroleum Marketers Association of Nigeria (lPMAN), which is driving up the price of petroleum products throughout the nation.
Alhaji Debo Ahmed, the National President of IPMAN, made this observation in a statement to the media on Tuesday in Lagos. He noted that the arbitrary and exorbitant nature of the price increase puts a burden on already-existing businesses and deters potential investors.
He emphasized that eventually, the public and consumers bear the brunt of these higher expenditures.
He stated, “Those that are already in the business will pass the burden to the consuming public and this affects the cost of products.”
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“I think NMDPRA, as an agent to the Federal Government, should advise them on the way to succeed on this removal of oil subsidy,”
“Between 2020 and 2023, NMDPRA had increased some, if not all, of its operational tariffs to over 600% and added other unnecessary tariffs, generating lines to the already existing ones,”
He provided an example where the calibration cost per tank, previously set at N20,000, has surged to N150,000 per tank, indicating a 650% increase.
Additionally, the price for pressure testing, formerly N20,000 per tank, has also risen to N150,000 per tank.
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Ahmed highlighted that the combined impact of these tariff hikes is placing substantial financial strains on both existing and new fuel stations.
He noted that renewing a license for an existing station could now exceed N2 million, while new stations may face expenses surpassing N4 million.
Expressing concern, Ahmed mentioned a newly imposed 5% tax on the sales or acquisition of a filling station. He believed that this tax could potentially discourage sales, mergers, and acquisitions within the industry.
He further explained that these tariff increases run counter to the objectives of deregulation, which aims to attract more investors, open the market, ensure product availability, and provide consumers with more choices.
