- Commission Cautions Profiteers, Says Consumers Must Benefit from Global Oil Price Slump
- Warns That Liberalisation Is Not Licence to Exploit Consumers
The Federal Competition and Consumer Protection Commission (FCCPC) has raised the alarm over what it described as the exploitation of Nigerian consumers by players in the downstream petroleum sector, warning that marketers found engaging in unfair pricing practices risk sanctions.
The Commission said findings from its ongoing surveillance of the petroleum market indicate that the reductions in petrol prices announced by local refiners, depot owners, marketers and retail outlets are insignificant and do not reflect the sharp decline in crude oil prices on the international market.
TheMatrix Newspaper had reported that a growing chorus of energy analysts, consumer advocates and industry stakeholders has intensified calls for a comprehensive investigation into petrol pricing in Nigeria, arguing that refiners like Dangote Refinery and marketers have failed to pass the benefits of sharply lower international crude oil prices on to consumers.
The renewed pressure follows fresh market data showing that while global crude oil prices have plunged by more than 40 per cent in recent weeks, domestic petrol prices have recorded only marginal reductions, leaving millions of Nigerians questioning the pricing template being used in the deregulated downstream petroleum sector.
Leading the debate, veteran journalist and TVC News analyst Babajide Otitoju described the disparity as one that deserves urgent public scrutiny, insisting that the available market figures do not appear to justify the current ex-depot and retail prices of Premium Motor Spirit (PMS).
According to market data reviewed by analysts, international crude oil prices fell from about $126 per barrel to nearly $72 per barrel, representing a decline of roughly 43 per cent. During the same period, however, the ex-depot price of petrol supplied by Dangote Petroleum Refinery declined from ₦1,275 per litre to about ₦1,125 per litre, a reduction of less than 12 per cent.
Speaking on the development, the Executive Vice Chairman and Chief Executive Officer of the FCCPC, Mr. Tunji Bello, said the Commission was deeply concerned that while marketers are usually quick to increase pump prices whenever crude oil prices rise, they have been reluctant to pass on the benefits of falling global crude prices to consumers.
According to him, “The Commission does not regulate or approve petroleum prices in a deregulated downstream market. Our responsibility under the Federal Competition and Consumer Protection Act, 2018, is to promote competitive markets, prevent anti-competitive conduct and protect consumers from unfair, deceptive and exploitative business practices.”
He added: “We are concerned that while dealers often respond swiftly by hiking pump prices whenever crude prices rise, it is curious that it is taking forever for consumers to benefit significantly when crude prices fall. Competitive markets must work fairly in both directions.”
Crude Prices Crash, Pump Prices Remain Stubbornly High
The FCCPC noted that international crude oil prices have dropped significantly following the ceasefire between the United States and Iran and the reopening of the Strait of Hormuz.
According to the Commission, crude prices have fallen from a peak of $120 per barrel in April to about $73 per barrel, returning to levels last seen in February.
Despite the sharp decline, petrol prices across Nigeria have remained largely elevated.
During the period of heightened tensions in the Gulf between April and May, marketers rapidly increased pump prices, with petrol selling for between ₦1,350 and ₦1,500 per litre, while diesel climbed to about ₦2,000 per litre.
Although some refiners have marginally reduced their gantry prices to between ₦1,025 and ₦1,075 per litre, the Commission observed that petrol is still retailing at an average of about ₦1,200 per litre across the country—far above the ₦800 to ₦900 per litre average recorded in February before crude prices surged.
While acknowledging that domestic fuel prices are influenced by factors such as foreign exchange fluctuations, refining costs, logistics, financing and distribution expenses, the Commission maintained that the prevailing market conditions should have translated into more meaningful price reductions for consumers.
Bello stressed that deregulation does not absolve businesses of their responsibility to operate fairly and competitively.
“Market liberalisation does not diminish businesses’ obligations to compete fairly or consumers’ right to fair treatment. Where credible evidence indicates conduct that undermines competition, exploits consumers or otherwise contravenes the Federal Competition and Consumer Protection Act, the Commission will investigate and take appropriate enforcement action,” he warned.
Consumers Urged to Report Unfair Pricing
The Commission called on Nigerians to report suspected cases of anti-competitive practices, price manipulation and other exploitative conduct through its established complaint channels.
The FCCPC said it would continue monitoring developments in the downstream petroleum sector to ensure consumers are not denied the benefits of declining global crude oil prices, warning that firms found violating competition and consumer protection laws would face regulatory action.
